The India International Financial Services Centres Authority approved draft IFSCA (Pension Fund) Regulations, 2026 at its 27th meeting, setting out a proposed framework for pension products in the International Financial Services Centre (IFSC). The draft would allow Pension Fund Managers (PFMs) in the IFSC to offer voluntary pension schemes to any individual aged 18 and above, alongside requirements intended to support secure, transparent long-term retirement savings. Under the draft, subscribers could choose between an Active Choice investment approach and an Auto Choice life-cycle fund where asset allocation adjusts with age. A dedicated Healthcare Benefit Option would permit up to 10% of contributions to be allocated to a separate healthcare sub-account invested in low-risk, highly liquid instruments, with access for medical emergencies or planned healthcare expenses and the ability at retirement to use the balance for health insurance purchase or roll it into the main pension corpus. The withdrawal and exit framework includes partial withdrawals for specified purposes after a lock-in period, systematic withdrawal plans at retirement, deferral of withdrawals up to age 75, and nomination and portability between PFMs; governance provisions include mandatory PFM registration with minimum net worth requirements, board oversight with independent directors, and an enterprise-wide risk management framework based on a three-lines-of-defence model, while investment is permitted across domestic and foreign equities, fixed income, alternative assets and other permissible assets subject to exposure and concentration limits. IFSCA said the notification would be released in due course on its website.

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