NPS refers to the National Pension System launched by Government of India. The system came into existence on 1st January, 2004.

It is voluntary contributory pension system regulated by the Pension Fund Regulatory and Development Authority (PFRDA). The system was first launched for government employees. Later on, the system extended its coverage to all Indian citizens. Besides, NRI (non –residents Indians) can also invest in the NPS, provided they have bank accounts in India. The main intention behind the launch of this system was to encourage the habit of savings among all individuals across the country. The National Pension system allows subscribers to invest regularly in pension accounts and get returns at retirement.

Who are eligible for NPS?

All India citizens including both state and central government employees are eligible for enrolling into the National Pension System. The minimum entry age required for investing in this system is 18 years and the maximum age is 65.

How to enrol for NPS?

In order to enrol for NPS, you need to submit the Composite Registration Form duly filled by you and submit it to your nearest Point of Presence (POP) or any authorized branches of POP. The list of POP service providers is available on the official websites of PFRDA, NSDL and POP. Both new as well as pre-existing users need to enrol themselves afresh for NPS.

How many accounts can be opened under NPS?

Two accounts can be opened under the National Pension System. They include: Tier –I and Tier –II accounts. The Tier –I account is the primary one while the Tier-II account is the secondary account. The Tie- I account does not allow premature withdrawal whereas the Tier-II account allows withdrawal of funds at any time.

How much do you contribute for NPS?

• For a Tier-I account, a subscriber needs to make an annual contribution of Rs. 6000. The subscriber also needs to pay Rs. 500 as one time contribution for the same.
• For Tier-II accounts, a subscriber needs to pay Rs. 2,000 annually and Rs. 250 as one time contribution.

However, there is no upper limit on the maximum amount of contribution made towards this system.

When to exist NPS?

A subscriber can exist the National Pension System when:

• He/she attains the age of 60 years.
• Because of death of the subscriber.
• Or at any time before reaching the age of 70 years.