UTI Asset Management Company today said it plans to spread its micro-pension business across the country to gain size and profitability.
"Unless we get very large volume, micro-pension will not be a profitable business," UTI AMC chairman and managing director UK Sinha said on the sidelines of a CII function in the Capital.
The company had started from Ahmedabad. From there it went to Bihar and covered 40,000 farmers and then entered Maharashtra and Tamil Nadu and is also now working in Andhra Pradesh and Karnataka.
"We plan to expand our micro-pension business nationwide," Sinha said, adding, "it’s not a question of how much we are ready to invest…but we feel if at the bottom of the pyramid we are able to reach large number then we will be serving our purpose."
The company’s micro-pension scheme, in which anybody can join with a minimum contribution of Rs 100, is under its UTI-Retirement Benefit Pension Fund.
UTI AMC subsidiary UTI Retirement Solutions is a pension fund manager of the new pension system (NPS) set up by Pension Fund Regulatory and Development Authority.
On the slow progress of the NPS, which has seen only 5,000 members since inception in 2008, Sinha said, "the reason why NPS has not been able to progress is because of the cost factor."