The bid was opened on Friday and sources indicated it was among the top eight bidders, and would be required to match the lowest bid of one paisa for every Rs 100 of NPS funds.

In April, HDFC Life petitioned the high court in Delhi against the Pension Fund Regulatory and Development Authority (PFRDA)’s disqualification of the bid. In May, the court set aside PFRDA's decision and asked it to evaluate the HDFC bid in accordance with the steps outlined in the formal Request For Proposal.

In the earlier bidding process of mid-April, Reliance Mutual Fund was said to have emerged the lowest bidder, with a fund management fee of a paisa for every Rs 100 of NPS. This meant the other applicants for the licence had to match this. The other bids, including of HDFC Pension Fund, have been in the range of 10-25p.

“When the letters are issued, the fund managers will have an option on whether or not to match the lowest bid. If they do, they will be considered for the licence,” said an official privy to the development. HDFC Life is said to have a bid of 18p. Letters are expected to be disbursed as early as next week by the regulator.

R V Verma, officiating chairman and member (finance) of PFRDA, had recently told Business Standard they wanted to expedite the process of issuing licences to fund managers for the private sector NPS. He had said the process would be completed in 30-60 days.

Earlier, there were some concerns that the lowest bid was unviable. The players have since said they would match it, to stay in the business. In the NPS space, the regulator had capped the investment management fee at 0.0102 per cent per annum but this was later fixed at 0.25 per cent per annum of the assets under management (AUM).

HDFC Pension Fund, SBI Pension Fund, LIC Pension Fund, UTI Retirement Solutions, ICICI Prudential Pension Funds, Kotak Mahindra Pension Fund, Reliance Capital Pension Fund and DSP BlackRock Pension Fund Managers have applied for a licence. There are also two new entities, Tata Mutual Fund and Birla Sun Life Insurance.

In January, PFRDA had said all existing private NPS fund managers and new players would have to take part in a re-application process. The licence would be issued after this process and be valid for five years.

NPS is the contributory pension scheme launched by the Union government in January 2004. It was made compulsory for all new government employees. Those in non-governmental livelihoods, including those not in any organised sector, were invited to join from 2009.

As of June 7, the NPS had 6.84 million subscribers. The total AUM was Rs 56,000 crore and seeing month-on-month growth of eight to nine per cent.