February 2025

EPF is in urgent need of an overhaul

EPF, Governments, Press / By /

A friend recently found himself facing court summons for an EPF default that happened 15 years ago—long after the problem was resolved. Another, a high-earning professional, is stuck contributing to EPF even though he no longer wants to, losing out on better investment options.
Why? Because once you’re inside the EPF Chakravyuh, there’s no way out. Meanwhile, NPS offers flexibility, investment choice to employees and no criminal liabilities for employers —but employees and employers alike are denied a real choice.
Truth be told, the system needs urgent reform. But will it ever change?
📖 Read the full article (4 minute read) in Business Standard to see why the rigidity of the EPF system affects every employer and employee and the employment generating potential of India itself.

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Give retirees choice of variable annuities

Press / By /

🔍 Give retirees a choice?

Prakash, a retiree is being forced into a “guaranteed” but low return annuity plan. After taking calculated risks by partly investing in equity and building a Rs. 1 crore retirement corpus in NPS, he is forced into a low-return “guaranteed” pension that cant beat inflation. What if he had a choice? Globally, retirees can pick variable pension payout products (PPPs). In India? No choice.

Why are we treating retirees like children who need financial babysitting? Mutual Fund investors have already understood that “Guaranteed” equals “Low returns” and have reaped the benefits from taking calculated risks through equity. It’s time retirees got the same choice.

📖 Harsh’s “Truth be told” column in Business Standard.

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Is it a step towards “Nyaya”?

Governments, Press, Taxes / By /

The big bang announcement on tax breaks overshadowed other important announcements like the launch of revamped CKYC 2.0 . That could be the UPI moment for the financial sector as financial inclusion and access to financial products will become easier. The move to activate the moribund annuities market is much needed as the absolute number of senior citizens are quite high in the country. The new tax bill to be introduced next week promises ” Nyaya” to the tax payers. Whether it actually delivers on the promise remains to be seen. Harsh’s take on Budget2025 published in the Business Standard.

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