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India: UTI Mutual Fund plans foray into pension sector


Times of India


  July 2, 2003

NEW DELHI - Country's biggest UTI Mutual Fund plans foray into pension sector once the government sets up Pension Fund Regulatory and Development Authority in October this year.

"We will bid for setting up a pension fund once the regulator is set up and the guidelines are laid down," a senior official of UTI Mutual Fund said.

The move is in line with Finance Ministry's plan of opening up the country's pension sector to private players but at the same time have one PSU.

Official sources said an interim regulator PFRDA would be put in place by October, which would lay down the guidelines for pension sector and then invite applications from private players.

UTI Mutual Fund could be one of the PSUs to apply for it. Some of the banks and foreign pension players like PNB-Vijaya Bank-Principal Financial group combine and Aviva Plc, also intend to foray into the pension sector.

The erstwhile Unit Trust of India had launched an array of regular income schemes intended to provide high returns to retired persons by investing in mostly debt papers.

UTI also had a low cost Unit Linked Insurance Plan, which it wanted to convert into a dedicated pension plan 2-3 years ago and had approached Insurance Regulatory and Development Authority for this purpose.

But after the US-64 imbroglio two years ago, the fund had to shelve the plan.

Currently, UTI Mutual Fund is managing funds like GrandMaster, Master Gain, US-95, Mahila Unit Scheme and fund for Charitable and Religious Trusts, which provide regular income but are NAV-based and SEBI compliant.

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