India’s Max Life insurance has secured a commencement of business (COB) certificate to foray into the pension fund management business, Money Control reported citing new agency PTI.

The life insurer’s subsidiary, Max Life Pension Fund Management, will manage the pension assets under the National Pension Fund’s investment choices.  

With an initial capital of INR500m, the new entity is anticipated to begin operations in October, Max Life managing director and CEO Prashant Tripathy told the news agency.

The CEO for the pension fund unit has already been appointed and other key posts will be filled soon, he added.

The entity will manage assets for both private and government sector subscribers, excluding the ‘default scheme’.

It aims to have INR1 trillion ($12.5bn) assets under management over the next ten years.

Additionally, the pension fund seeks to offer maximum risk-adjusted returns for its customers constantly in the long run, whilst meeting PFRDA’s guidelines.

The approval from Pension Fund Regulatory & Development Authority (PFRDA), will allow the firm to offer customers pension, annuities, and pension fund management offerings.

Tripathy added that the new unit is also looking to secure approval to offer services to enable customers to open new NPS accounts.

“Max Life Pension Fund Management strengthens our presence in the retirement segment. We will leverage our competitive fund management capabilities and the distribution strength of Max Life, including our corporate business teams to spread awareness about NPS and drive value for our customers,” he added.