Almost 1.42 billion people call India home. So as of April 2023, this population is more than China's. According to EY, over 60 percent of this population is in the working age-bracket but in a few decades, these people will belong to the aged, or retired category. The UN estimates that by 2050, every fifth person in India will be above the age of 60. And that could be a problem because India does not have a formal social security or pension system that will offer this ageing population a security net.

Speaking to CNBC-TV18, Preeti Chandrashekhar, Business Leader - Retirement, Health & Benefits, Mercer India said, "India is low on adequacy as compared to many other countries. And the primary reason is that we don't have any social security system, there is no minimum pension that everybody in the country will get. The second thing that we are seeing in India is that the minimum access rate, minimum access age to the pension is not there virtually."

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The government has tried to push the National Pension System as a more secure pension system and position it as a form of retirement planning. But NPS is plagued with low adoption, adequacy, and minimum pension norms. However NPS is voluntary.

This has breathed life into a slew of start-ups who are designing platforms to not just improve access using data-driven goal-setting models, but pushing its wealth management features through innovations like real-time tracking, comparisons, and goal-setting that adjusts for inflation.

"Credit and savings go against each other. That's why we focus on just one goal which cannot be diluted by credit. There is no loan available for retirement, there is no EMI set for that. So we do build nudges based on data. For example, I can compare my retirement versus what my peer's retirement look like or ideal retirement looks like. Right? And if I increase my savings by 5-8 percent, or 10 percent? How would I improve it? So it is more data-driven," Kuldeep Parashar, Co-Founder & CEO, PensionBox told CNBC-TV18.

While Atul Shinghal, CEO, Scripbox said that as people witness increase in income, they want to be guided in terms of retirement planning. Shinghal added that their platform capitalises on the need of personalisation in wealth management space by creating a digital portfolio unique to each customer.

The innovations, especially related to transparency, are catching on. Users of platforms like PensionBox emphasised that digitisation has made it easier for them to track their pension contributions.

The influx of startups has helped ramp up NPS adoption. As of April, the National Pension Scheme has over 1.73 crore subscribers with above Rs 8.9 lakh crore worth of assets under management. This indicates that the NPS subscriber base has increased around 23 percent between FY22 and FY23. But this number is still miniscule when compared to a working population that the World Bank estimates stood at 52 crore in 2022. Startups say the only way this will go up is if the government actively partners with them to expand reach and offers a push to retirement-planning products.

"It could be the state plus the startups combining together and building up a solution. So I don't want them to build a solution alone. Build it with us. So if you want to distribute it, let's figure it out. You give us a case, we build up something a plugin to you and then we'll figure it out. So I want to make sure that people build it together. It becomes faster on that part," Parashar said.

Despite the pandemic accelerating digital adoption, the National Pension System is largely ridden with lower adoption even among the working class. According to Mercer's Global Pension Index 2022, only 6 percent of India's working population is covered by private pension mainly because a majority of the working class is in the unorganised sector. The government has started reviewing the NPS system following concerns over lower payouts and trouble with accessibility but most of the government's moves to push NPS have targetted government employees, and not the private sector.

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