1. Welcome to the “National Pension System” NPS – Pension nahi yeh Pran Hai 1 ‘NPS’ - Pension nahi yeh Pran hai

2. Agenda 2 Understanding NPS…. What is NPS ? How does it work ? Why should I invest in NPS ? How is it superior to other Retirement Plans ? Tax treatment on Contribution, Accretion & Maturity under NPS. NPS Report Card – 1. Assets Under Management 2. Fund Performance as on 31/03/2015 NPS ‘NPS’ - Pension nahi yeh Pran hai

3. About NPS 3 NPS is a ‘Government of India’ initiative with an objective of Development of a sustainable and efficient voluntary defined contribution Pension System in India. It is regulated by PFRDA. NPS provides a platform for savings through three baskets of Investment Equity (E), Corporate Bonds (C) and Govt. Securities (G) to create a Retirement Corpus (Pension Wealth), to enable subscriber for purchasing Annuity post retirement. It also allows for withdrawal of up to 60% of the Retirement Corpus post retirement. The withdrawal can be spread over 10 Years post Retirement age. It is open for all citizens of India (Resident/Non Resident) who are between 18-60 years of age. ‘NPS’ - Pension nahi yeh Pran hai

4. NPS - Architecture Main Components of the NPS Architecture are : 1.Points of Presence (PoPs) – The first single contact point. It is the interface between the subscribers and the NPS Architecture. Responsible for disseminating all the information about NPS.Points of Presence (PoPs) 2.Central Recordkeeping Agency (CRA) -( at present NSDL) 3.Pension Fund Managers – ( at present 8 PFMs)Pension Fund Managers 4.Custodian (SHCIL) 5.Trustee Banker (Axis Bank Ltd.) 6.Annuity Service Providers - (at present 7 annuity providers)Annuity Service Providers It has an unbundled Architecture. Ownership of the Product does not lie with any single entity 4

5. NPS Architecture CRA (NSDL) CRA (NSDL) Subscribers Custodian (SHCIL) Custodian (SHCIL) NPS Trust Annuity Service Providers PFMs PFRDA Online POP Information Flow Fund Flow Trustee Bank Axis Bank Ltd. Trustee Bank Axis Bank Ltd. 5

6. Why should I invest in NPS? Additional Tax Deduction: Opportunity of Extra Tax Savings under Sec 80 CCD (1B) up to Rs.50000/- ( This is applicable for investments in NPS only) and is over and above the Sec 80C limit. Lower Expense Ratio : NPS is perhaps the world’s lowest cost pension scheme. The total recurring expenses inclusive of the Fund Management fee and all other handling and administrative charges would work out to be around 0.05% to 0.21% p.a. The Lower Expense ratio would lead to HIGHER RETIREMENT CORPUS. Ensures Complete Portability: NPS account can be operated from anywhere in the country irrespective of employment and geography. Tax Efficient : The Retirement Corpus used for buying Annuity will be totally Taxfree. No liquidity before Retirement: Under Normal circumstances, No withdrawal is allowed before Retirement i.e. 60 Years of age. In a true sense this investment will prove to be the "REAL BUDHAPE KI LATHI". Flexibility: Subscribers have - i) Choice of Pension Fund managers (PFMs) ii) Choice of Investment mix iii) Choice of Life Cycle Fund is also available I have a freedom to change the PFM or the Investment Mix once a year without any exit load. 6

7. Public Provident Fund (PPF) Mutual Fund Pension Schemes Pension Plans from Insurance Companies Small Savings Scheme (Post Office Investments) Other customized Individual Products Is there any other good option available? 7 Popular Retirement Tools…… ‘NPS’ - Pension nahi yeh Pran hai

8. How is it superior to other perceived Retirement Plans ? 8 Parametres NPS MF Pension Products Insurance Pension Products PPF Postal Savings Tax Rebate Additional Tax Savings under Sec 80 CCD (1B) which is beyond the Sec 80 C Limit Only under Sec 80 C Limit Only under Sec 80 C Limit Only under Sec 80 C Limit Only under Sec 80 C Limit Expense Ratio Ranges between 0.15% to 0.25% Ranges between 2% to 2.50% Ranges over 2.50% Government Administered Returns Market Linked Assured (Depends upon 10 Year G SEC current yield) Assured Asset Allocation Subscribers can customize based on their Risk appetite. Also change once a Year without any exit load Based on Inestment Objective of the Scheme. Investors can not customize it. Government Administered Liquidity No liquidity before Retirement Age Liquidity available subject to exit load Liquidity available subject to huge exit load Liquidity not before 7th Year Not Available Tax Treatment on Maturity The amount used for purchasing Annuity - TAXFREE The Amount withdrawn as lumpsum - TAXABLE LTCG on Schemes where Equity Component 65% Maturity Amount TAXFREE Maturity Amount TAXABLE Fund Managers Can be Changed once a Year without any exit load Can not be Changed N/A

9. NPS – Taxability……… 9 EventTaxability Contribution in Tier-I Account Additional deduction of Rs.50,000/- under Sec 80 CCD(1B) available in excess of Rs.1,50,000/- under Sec 80 C Accretion in Tier-I Exempt Withdrawal from Tier-I (including accretions) 1. Amount used to purchase annuity is exempt. 2. Amount withdrawn as lump sum is taxable. Currently NPS follows E-E-T regime of taxation. Under DTC it is proposed to be under EEE. ‘NPS’ - Pension nahi yeh Pran hai

10. Effect of Lower Expense Ratio on Retirement Corpus – a comparison (Assumption : Rs.8000/- being invested Quarterly with assumed gross return of 10% ) 10 ‘NPS’ - Pension nahi yeh Pran hai Under NPS The % Difference Age Investment for No of Years Assumed Gross Return % Expense Ratio % Net Return % Investment made in total Retirement Corpus at 60 2040100.0559.94512,80,0001,64,46,955.36+ 77.04 2535100.0609.94011,20,00099,23,439.19+ 62.19 30 100.0709.9309,60,00059,33,225.54+ 48.92 3525100.0809.9208,00,00034,99,334.01+ 37.35 4020100.1009.9006,40,00020,10,659.71+ 27.16 4515100.1359.8654,80,00011,01,406.69+ 18.35 5010 0.2059.7953,20,0005,46,186.77+ 10.82 Under other Investment Schemes (Expense ratio 2% assumed) Age Investment for No of Years Assumed Gross Return % Expense Ratio % Net Return % Investment made in total Retirement Corpus at 60 2040102.0008.00012,80,00092,90,122.04 2535102.0008.00011,20,00061,18,558.11 30 102.0008.0009,60,00039,84,186.51 3525102.0008.0008,00,00025,47,815.61 4020102.0008.0006,40,00015,81,179.17 4515102.0008.0004,80,0009,30,660.56 5010 2.0008.0003,20,0004,92,880.18

11. Effect of Lower Expense Ratio on Retirement Corpus – a comparison (Assumption : Rs.8000/- being invested monthly with assumed gross return of 10% ) 11 ‘NPS’ - Pension nahi yeh Pran hai Under NPS The % Difference AgeInvestment for No of Years Assumed Gross Return % Expense Ratio % Net Return % Investment made in total Retirement Corpus at 60 2040100.0559.94538,40,0004,40,80,760+69.97 2535100.0609.94033,60,0002,70,23,703+ 56.65 30 100.0709.93028,80,0001,64,09,728+ 44.70 3525100.0809.92024,00,000 98,22,480+ 34.21 4020100.1009.90019,20,000 57,23,667+ 24.94 4515100.1359.86514,40,000 31,76,640+ 16.86 5010 0.2059.795 9,60,000 15,94,268+ 9.92 Under Other Investment Schemes (Expense ratio 2% assumed) Age Investment for No of Years Assumed Gross Return % Expense Ratio % Net Return % Investment made in total Retirement Corpus at 60 2040102.0008.00038,40,0002,59,34,431 2535102.0008.00033,60,0001,72,50,823 30 102.0008.00028,80,0001,13,40,906 3525102.0008.00024,00,000 73,18,715 4020102.0008.00019,20,000 45,81,280 4515102.0008.00014,40,000 27,18,228 5010 2.0008.000 9,60,000 14,50,266

12. 12 Starting Age Total Amount Invested Assumed Rate of Return Retirement Corpus at Age 60 Assumed Rate of Return Retirement Corpus at Age 60 Assumed Rate of Return Retirement Corpus at Age 60 1834600010%869619211%1231662412%17452471 1934000010%789962911%1109005812%15576563 2033400010%717548111%998504312%13901646 2132800010%651716411%898953412%12406184 2232200010%591869411%809268012%11070950 2331600010%537463211%728470212%9878776 2431000010%488002911%655679512%8814336 2530400010%443039011%590102212%7863943 Starting Age Total Amount Invested Assumed Rate of Return Retirement Corpus at Age 60 Assumed Rate of Return Retirement Corpus at Age 60 Assumed Rate of Return Retirement Corpus at Age 60 18420000010%5914007011%7980654712%108008262 19410000010%5366369911%7179779012%96335948 20400000010%4868518111%6458269312%85914239 21390000010%4415925611%5808260712%76609142 22380000010%4004477811%5222667312%68301020 23370000010%3630434311%4695105612%60883053 24360000010%3290394911%4219824912%54259869 25350000010%2981268111%3791644112%48346312

13. NPS Report Card 1.Assets Under Management 2.Fund Performance as on 31/03/2015 13

14. Where do we Stand now in terms of AUM? 14 Total AUM Details as on 31/03/2015 Pension Fund ManagerAUM % of Total Industry SBI PENSION FUNDS PRIVATE LIMITED31407.0938.84 UTI RETIREMENT SOLUTIONS LIMITED24831.4530.71 LIC PENSION FUND LIMITED24010.1329.70 ICICI PRUDENTIAL PENSION FUNDS MGMENT COMPANY LTD369.000.46 KOTAK MAHINDRA PENSION FUND LIMITED107.470.13 RELIANCE CAPITAL PENSION FUND LIMITED76.970.10 HDFC PENSION MANAGEMENT COMPANY LIMITED53.080.07 Grand Total80855.19100.00

15. Incentive Scenario for IFAs……. Rs.75/- per Application Up front commission of 0.15% of the amount mobilised i.e. on each instalment 15

16. Annuity Service Providers  Subscribers of the National Pension System (NPS) would have a choice to select Annuity Service Providers, and annuity schemes offered by them at the time of exit from NPS.  Pension Fund Regulatory and Development Authority (PFRDA) has at present empaneled the following Seven IRDA approved life insurance companies for providing annuity services to the subscribers of National Pension System (NPS). 1. Life Insurance Corporation of India 4. Bajaj Allianz Life Insurance Co. Ltd 2. SBI Life Insurance Co. Ltd. 5. Star Union Dai-ichi Life Insurance Co. Ltd. 3. ICICI Prudential Life Insurance Co. Ltd. 6. Reliance Life Insurance Co. Ltd. 4. 7. HDFC Standard Life Insurance Co. Ltd. 16

17. Types of Annuity available: Pension (Annuity) payable for life at a uniform rate to the annuitant only. Pension (Annuity) payable for 5, 10, 15 or 20 years certain and thereafter as long as you are alive. Pension (Annuity) for life with return of purchase price on death of the annuitant (Policyholder). Pension (Annuity) payable for life increasing at a simple rate of 3% p.a. Pension (Annuity) for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant. Pension (Annuity) for life with a provision of 100% of the annuity payable to spouse during his/her lifetime on death of the annuitant. 17

18. Low Expense Ratio 18 ‘NPS’ - Pension nahi yeh Pran hai Charges under NPS IntermediaryCharge HeadService Charge Method of Deduction PoP Initial Subscriber Registration (One Time)Rs. 100/- To be collected upfront Initial Contribution 0.25% of the amount mobilised All Subsequent Contributions Minimum: Rs.20/- & Maximum: Rs.25000/- Any Non Financial TransactionRs.20/- per Transaction CRA PRA Opening (One Time)Rs.50/- Through NAV Cancellation/ Deduction PRA Maintanance (Per Annum)Rs.190/- Per Transaction (Financial/Non Financial)Rs.4/- Custodian Asset Servicing (Per Annum)0.0075% PFM Investment Management Fee0.01 % per Annum The overall expense ratio (PoP Charges + CRA Charges+ PFM Charges+ Custodian Charges) will range from 0.05% to 0.21% depending on the subscriber’s entry age from 18 to 50 Years

19. Important …. Any person above the age of 18 irrespective of nature of employment or profession can open an NPS account. NPS is flexible and portable i.e the NPS account opened once can be used anywhere across India even when you change your job, profession, Location etc. NPS is independent of other retirement plans/investments. Any person with or without existing retirement plans/investments like EPF/PF, PPF, Insurance Policies, Mutual Funds, Bank Deposits etc can open NPS account and plan the retirement better. NPS investments can be customised (within the specified asset class and limits) as per individual need and can be changed once a year. NPS also provides an Auto Choice Option for investment where investments in asset classes of Equity, Corporate debt and Gsec gets realigned based on persons age. Opening an account in NPS is the first step for securing ones Sunset Years 19

20. Disclaimer :  The Illustration and figures given in the presentation are only for understanding purpose and based on assumptions mentioned in each illustration.  Investments in the scheme are subject to the risk involved with various asset class.  Past performance may or may not be sustained in future. Nothing contained herein shall amount to the PFM having assured any minimum rate of return on the investment.  All investment in Pension Funds and securities are subject to market risks and the NAV of the funds may go up or down depending on the factors and forces affecting the securities market.  For complete information of NPS please refer to the Offer document and/or log on to PFRDA website www.pfrda.org.www.pfrda.org 20

21. Details of Tax Deductions as per Budget Memorandum 2015 Deduction u/s 80C Rs. 1,50,000 Deduction u/s 80CCD (1B) - (Only NPS) Rs. 50,000 Deduction on account of interest on house property loan (Self occupied property) Rs. 2,00,000 Deduction u/s 80D on health insurance premium Rs. 25,000 Exemption of transport allowance Rs. 19,200 Total Rs. 4,44,200

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