Retirement Adviser
Also written RA · Retirement Adviser (PFRDA)
A PFRDA-registered individual or firm that advises subscribers on the NPS for a fee, acting in a fiduciary capacity and never collecting cash for contributions.
In plain language
Someone has to help a prospective NPS subscriber understand what they are signing up for, and help an existing one manage the account afterwards. That is the job the Retirement Adviser was created to do.
A Retirement Adviser can be an individual, a partnership firm, a company, or a registered trust or society, but every one of them is registered and regulated by the PFRDA. This paper — NISM Series-XVII — is the certification exam that a would-be individual Retirement Adviser, or the key staff of a non-individual one, must pass.
How it works
A Retirement Adviser is registered under the PFRDA (Retirement Adviser) Regulations, 2016. Beyond passing this NISM exam, the individual, or the key personnel of a firm, must also clear a "fit and proper" test.
The adviser acts in a fiduciary capacity, may take remuneration only from the subscriber advised and from no one else, may collect no cash for contributions, and must disclose every conflict of interest. There is no limit on the number of Points of Presence a Retirement Adviser may tie up with.
Charges are capped: up to Rs 400 as a one-time onboarding fee, plus 0.02% of assets under management, subject to a minimum of Rs 250 and a maximum of Rs 2,000 per subscriber per financial year. These charges are collectible only under a signed subscriber agreement, and never at onboarding.
A worked example
Mr Iyer becomes a Retirement Adviser after passing the NISM Series-XVII exam and clearing PFRDA's fit-and-proper check. He signs up a new subscriber, Ms Rao, and charges her the maximum Rs 400 onboarding fee under a signed agreement.
A year later, Ms Rao's NPS corpus has grown to Rs 10,00,000. At 0.02% of AUM, Mr Iyer's fee for the year would work out to Rs 2,000 — which happens to land exactly at the scheme's maximum per-subscriber annual charge.
When her corpus grows further to Rs 25,00,000 the following year, 0.02% would come to Rs 5,000 — but the Rs 2,000 cap still applies, so that is all Mr Iyer may charge her for that year, regardless of how large her corpus has grown.
Why NISM asks about it
Chapter 4, section 4.1.1 (Intermediaries and Constituents of the NPS), defines the Retirement Adviser among the NPS constituents and sets out the registration, fiduciary duties and fee schedule. Since this exam certifies Retirement Advisers themselves, expect direct recall of every figure in the fee schedule and the fiduciary restrictions.
Common exam traps
- The fee is capped at Rs 2,000 a subscriber a year, no matter how large the AUM-based calculation comes to.
- No cash for contributions, ever — a Retirement Adviser handling a subscriber's contribution amount in cash is a clear violation.
- Remuneration only from the subscriber advised — an adviser cannot also be paid by a Pension Fund or PoP for referring that same subscriber.
- No restriction on the number of PoP tie-ups — do not confuse this with the fee cap, which is a separate rule.
- Onboarding charges are never collected at onboarding itself — they still need the signed subscriber agreement first.
Check yourself
1.How long is a Retirement Adviser's certificate of registration valid, and when must renewal be applied for?
- a)Five years, with renewal applied for one month before expiry
- b)Three years, with renewal applied for three months before expiry
- c)Permanently valid unless suspended or cancelled
- d)One year, renewable annually on payment of a fee
Show the answer
Answer: (b) Three years, with renewal applied for three months before expiry
⚠️ "The certificate of registration SHALL HAVE A VALIDITY OF 3 YEARS FROM THE DATE OF ISSUE. THE APPLICATION FOR RENEWAL OF THE CERTIFICATE SHALL BE MADE 3 MONTHS BEFORE THE EXPIRY of the period of validity."
Renewal is not a formality: ⚠️ "THE RENEWAL OF APPLICATION SHALL BE TREATED IN THE SAME MANNER AS DURING THE INITIAL GRANT OF CERTIFICATION." Every requirement — qualification, certification, fit and proper — is tested afresh.
⚠️ And past conduct is weighed: "PFRDA MAY ALSO TAKE INTO CONSIDERATION THE PERFORMANCE OF THE RETIREMENT ADVISER DURING THE ORIGINAL PERIOD OF CERTIFICATION INCLUDING THE NUMBER OF NEW ACCOUNTS OPENED."
⚠️ Option (c) describes the CRA's certificate, which "SHALL REMAIN VALID, UNLESS SUSPENDED OR CANCELLED BY PFRDA, OR PERMITTED TO BE SURRENDERED... FOR JUST CAUSE TO BE SHOWN." Different intermediary, different rule.
One more prohibition to carry: ⚠️ "A REGISTERED RETIREMENT ADVISER MAY NOT DELEGATE, TRANSFER OR LEND ITS CERTIFICATE OF REGISTRATION TO ANY THIRD PARTY."
2.From whom may a Retirement Adviser receive remuneration in respect of NPS advice?
- a)From the pension fund whose scheme is recommended
- b)Only from the prospect or subscriber being advised, and from no one else
- c)From the Point of Presence with which the adviser has a tie-up
- d)From any party, provided the payment is disclosed
Show the answer
Answer: (b) Only from the prospect or subscriber being advised, and from no one else
⚠️ "A RETIREMENT ADVISER SHALL NOT RECEIVE ANY CONSIDERATION BY WAY OF REMUNERATION OR COMPENSATION OR IN ANY OTHER FORM FROM ANY PERSON OTHER THAN THE PROSPECT/SUBSCRIBER BEING ADVISED, in respect of National Pension System or other pension scheme regulated by the Authority."
Note the width of "or in any other form" — it catches gifts and hospitality, not just commission.
⚠️ Option (d) is the sophisticated trap. Disclosure is required — "a retirement adviser shall DISCLOSE TO ITS PROSPECT ANY CONSIDERATION... RECEIVED OR RECEIVABLE BY IT" — but disclosure does not cure a prohibited payment. The rule is a prohibition, not a disclosure obligation.
The companion prohibition: ⚠️ "A RETIREMENT ADVISER SHALL NOT COLLECT ANY AMOUNT IN CASH FOR INVESTMENT/CONTRIBUTION TO THE PENSION ACCOUNT OF THE SUBSCRIBERS."
Together these define the fiduciary position: one removes the incentive to prefer one pension fund over another, the other keeps the adviser's hands off the subscriber's money. The adviser may still tie up with any number of PoPs — there is no restriction on the number — provided subscriber interests are not adversely affected.
3.A company secretary advises clients on NPS incidental to her professional service. What is her position under the Retirement Adviser Regulations?
- a)She must register, since only advocates are exempt
- b)She is exempt from registration but must comply with all general obligations and is fully liable for any defaults
- c)She is exempt from registration and from the regulations entirely
- d)She may register voluntarily but has no obligations either way
Show the answer
Answer: (b) She is exempt from registration but must comply with all general obligations and is fully liable for any defaults
Members of the ICSI are among the exempt: "any member of INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA, INSTITUTE OF COMPANY SECRETARIES OF INDIA, INSTITUTE OF COST AND WORKS ACCOUNTANTS OF INDIA, INSTITUTE OF ACTUARIES OF INDIA or any other professional body as may be determined by the PFRDA, WHO PROVIDES RETIREMENT ADVICE TO HIS CLIENTS, INCIDENTAL TO HIS PROFESSIONAL SERVICE." Advocates, solicitors and law firms are exempt on the same "incidental" basis.
So she remains bound by the substance: no consideration from anyone other than the client advised · no cash for contributions · KYC, AML and CFT under the PMLA, 2002 · disclosure of conflicts beforehand · arms-length relationship and segregation of activities · the code of conduct and all prescribed disclosures.
⚠️ Note the word "INCIDENTAL" does real work. Advising existing professional clients on NPS as part of her practice is incidental; setting up a separate retirement advisory business would not be, and would require registration.
Where this is taught
Free preparation for NISM Series XVIIRelated terms
- All Citizen ModelThe voluntary NPS model for Indian citizens, resident or non-resident, and OCI cardholders, in which the subscriber alone contributes, makes the choices and bears the Tier I and Tier II charges.
- Permanent Retirement Account NumberThe unique account number issued when an NPS account is opened; it stays with the subscriber for life and across employers, which is what makes NPS portable in a way EPF historically was not.
- Common SchemesThe pre-existing NPS Active Choice and Auto Choice (life-cycle) options, now given this collective label to set them apart from the newer, persona-targeted schemes launched under the Multiple Scheme Framework.
- PFRDAThe Pension Fund Regulatory and Development Authority — interim NPS regulator from 2003 and statutory authority for the pension sector since 1 February 2014 under the PFRDA Act, 2013.
- Unbundled architectureThe NPS design principle of splitting authority and responsibility across separate, independent intermediaries, rather than concentrating decision-making with any single entity.
- Intermediary under the PFRDA ActThe PFRDA Act's defined class of regulated entities — pension funds, the CRA, the NPS Trust, advisers and points of presence — none of which may operate without a certificate of registration.
- Point of PresenceThe NPS distribution layer — a registered intermediary that onboards subscribers, collects contributions and processes service and exit requests, needing Rs 2 crore of net worth and electronic connectivity to the CRA.
- Overseas advisory feesThe dollar-denominated ceilings a retirement adviser may charge a prospect outside India — up to US$ 8 for on-boarding to a PoP in India, US$ 2 through an overseas PoP branch, and US$ 1 per later transaction.