Plan the best NPS investment ahead and enjoy peace of mind. A little every month in
National Pension System (NPS) can lead to substantial savings for your future.
NPS Vatsalya: A Promise of Care that lives beyond
you
Plan the best investment for your child’s future through NPS
Vatsalya.
A small contribution every month to the National Pension System (NPS) under the
Vatsalya Scheme can lead to substantial savings over time — building a secure
foundation for your child’s golden years.
National Pension System in India (NPS) is an initiative by the Pension Fund Regulatory and
Development Authority (PFRDA) to develop retirement savings amongst the citizens of India. It is
a
voluntary, contribution scheme / Plan which allows an individual to contribute during his
working
life, build a corpus and enjoy regular income in the form of pension and lumpsum withdrawal post
retirement. Now Corporate Entities can also contribute to their employees pension account under
"NPS
- Corporate Sector Model". NPS is the best national pension plan in India.
Greater the value of investment made, longer the term over which the fund accumulates and the
lower
the charges deducted, the larger would be the eventual benefit of the accumulated pension
wealth.
You can also contribute to your fund online.
Introduction to NPS Vatsalya
NPS Vatsalya is a forward-looking initiative under the National Pension System (NPS) by
the Pension Fund Regulatory and Development Authority (PFRDA), aimed at encouraging
long-term retirement savings for minors from an early age.
Under this voluntary, contribution-based scheme, parents or guardians can open an NPS account
on behalf of their children, allowing them to build a strong financial corpus over the
years. The accumulated funds can later be used to provide regular pension income and lump sum
withdrawals, securing the child’s financial future.
The main objectives of NPS are
To provide income for old age
Reasonable market based returns
over the long term period
Under the NPS, an individual's savings is pooled in a pension fund. These funds
are invested by Pension Fund Regulatory and Development Authority (PFRDA)
regulated Professional Fund Managers in the diversified portfolios comprise of
government bonds, bills, corporate debentures and shares. These contributions
would grow and accumulate over the years, depending on the returns earned on the
investment made.
At the time of a normal exit from NPS, the subscribers may use the accumulated
pension wealth under the scheme either to purchase a life annuity from a PFRDA
empaneled life insurance company or withdraw a part of the accumulated pension
wealth as lumpsum, if they choose to do so.
The National Pension System or NPS is one of the most cost effective retirement
planning investment options available to an individual today.
A citizen of India, whether
resident or non-resident can join NPS subject to the following
conditions:
Subscriber should be between 18 –
70 years of age as on the date of submission of his / her application.
SSubscriber should comply with the
prescribed Know Your Customer (KYC) norms as detailed in the Common
Subscriber Registration Form (CSRF)
Pre-existing account holders under
NPS cannot join again as existing account is portable across
geographies.
1. Flexibility in Contributions:
A subscriber has the flexibility to
alter his contributions on a yearly basis subject to minimum
contribution being ₹1000 p.a for a Tier 1 account.
It also allows flexibility to
contribute lump sum amounts whenever an investor chooses to do so. For
example, on certain occasions like receipt of a bonus, maturity of a
FD/Life Insurance plan, a subscriber can make a one-time lump sum
contribution.
A subscriber can also choose to
gradually increase his contributions as his income goes up, i.e., link
contributions to one's earnings, or as he gets closer to his retirement.
2. Regulated:
NPS is regulated by PFRDA, with
transparent investment norms, regular monitoring, and performance review
of fund managers by NPS Trust.
3. Choice of Fund Managers:
A subscriber has the option to choose from any of the 11 fund managers; further,
a subscriber can change his fund manager on a yearly basis. This provides the
subscriber an option to invest funds with the best performing fund manager.
Aditya Birla Sun Life Pension
Management Limited
LIC Pension Fund Limited
Axis Pension Fund Management
Limited
DSP Pension Fund Managers Private
Ltd
SBI Pension Funds Private Limited
HDFC Pension Management Company
Ltd.
TATA Pension Management Limited
ICICI Prudential Pension Funds
Management Company Limite
UTI Retirement Solutions Limited
Kotak Mahindra Pension Fund Limited
4. Portability:
A subscriber can operate his
account from anywhere in the country. A large number of entities working
as Points of Presence or POPs licensed by the PFRDA provide easy access
as NPS service centers. A subscriber can therefore operate his or her
account even if he or she has moved cities, changed jobs, or Pension
Fund Managers.
5. Tax Benefits:
From Investment to Exit, NPS offers
exclusive tax-saving opportunities.
Tax Benefit available to Individual:
Any individual who is Subscriber of
NPS can claim tax benefit under Sec 80 CCD (1) with in the overall
ceiling of Rs.1.5 lac under Sec 80 CCE.
Exclusive Tax Benefit to all NPS Subscribers u/s 80CCD (1B):
An additional deduction for
investment up to Rs.50,000 in NPS (Tier I account) is available
exclusively to NPS subscribers under subsection 80CCD (1B) This is over
and above the deduction of Rs.1.5 lakh available under section 80C of
Income Tax Act, 1961.
Tax Benefits under the Corporate Sector:
Corporate Subscriber: Additional
Tax Benefit is available to Subscribers under Corporate Sector, u/s
80CCD (2) of Income Tax Act. Employer's NPS contribution (for the
benefit of employee) up to 10% of salary (Basic + DA), is deductible
from taxable income, up-to 7.5 Lakh.
Corporates: Employer's Contribution
towards NPS up to 10% of salary (Basic + DA) can be deducted as
'Business Expense' from their Profit & Loss Account. Please note: Tax
benefits are applicable for investments in Tier I account only. What
will be the investment proof to avail the tax benefit under NPS?
Tax Benefits under the Corporate Sector:
BY POINT OF PRESENCE
(UPFRONT)
SL NO
DESCRIPTION
FEES
GST
TOTAL
REMARKS
1
Initial Subscriber Registration Charges
400.00
72.00
472.00
2
Initial Contribution Upload Charges
30.00
5.40
35.40
0.50% of The Contribution Amount
Subject to
a
Min
of Rs.30/- and a Maximum of
Rs.25000/-
3
Any Subsequent Contributions
30.00
5.40
35.40
0.50% of The Contribution Amount
Subject to
a
Min
of Rs.30/- and a Maximum of
Rs.25000/-
4
Any Other Transaction Not Involving a
Contribution
Upload
30.00
5.40
35.40
5
Processing of Exit / Withdrawal Form
0.125% of Corpus with Min. Rs.125/- &
Max.
Rs.500/-
BY CRA
SL NO
DESCRIPTION
PROTEAN-CRA FEE
CAMS-CRA
REMARKS
1
PRAN Opening Charges (One Time)*
40.00
40.00
Through Cancellation of Units
2
Annual PRAN Maintenance Cost Per Account (Per Annum)
69.00
65.00
Through Cancellation of Units
3
Charges Per Transaction (Financial /Non-Financial)
3.75
3.50
Through Cancellation of Units
* In case a subscriber opts not to
have
a
physical PRAN Card or
Welcome Kit, reduced account opening charges of CRA are applicable
as
under:
4
Account opening with Physical PRAN card
40.00
40.00
Through Cancellation of Units
5
Account opening with ePRAN card (Welcome kit sent in hardcopy)
35.00
Option not available
Through Cancellation of Units
6
Through Cancellation of Units
18.00
18.00
Through Cancellation of Units
Tier-II transaction charges are same as Tier-I.
BY OTHER INTERMEDIARIES
SL NO
INTERMEDIARY
DESCRIPTION
FEES
REMARKS
1
NPS Trust
Reimbursement of Expenses
0.003% of Assets Under Management P.A.
Adjustment in NAV of Scheme
2
Custodian
Asset Servicing charges
0.000000001770% of Assets in Custody P.A.
Adjustment in NAV of Scheme
3
Pension Fund Manager
Investment Management Fee
0.03% - 0.09% of Asset under Management P.A.
Slabs of AUM Managed by the Pension Fund
Maxium Investment Management Fees(IMF)
Upto 10,000 Cr.
0.09%*
10,001 to 50,000 Cr.
0.06%
50,001 to 1,50,000 Cr.
0.05%
Above 1,50,000 Cr.
0.03%
Adjustment in NAV of Scheme
Active Choice : Subscriber will have an option as to how their wealth is
to be invested between following 4 options
Asset Class E :
Investments in equities.
Asset Class C :
Investments in Fixed Income securities of Corporate.
Asset Class G :
Investments in Government Fixed income securities.
Asset Class A :
Investments in Alternative Investment Funds (*)
Note:
1. Subscription can be distributed among E,C,G,A with a cap of 75% for Asset
Class
"E" and 5 % for Asset Class "A".
"Accelerate wealth creation early -- harnessing high equity for your retirement goals."
Life Cycle 50 - Moderate (10E / 55 Y)
50% up to 35 years, falling to 10% at 55+
"Balance growth and protection -- a steady path for building and safeguarding retirement wealth."
Life Cycle 25 - Low (5E / 55 Y)
25% up to 35 years, falling to 5% at 55 +
"Preserve your savings with steady growth -- designed for stability as you near retirement"
Life Cycle - Aggressive (35E / 55 Y)
50% up to 45 years, falling to 35% at 55+
" Be aggressive & Stay Invested longer in growth assests -- for a stronger retirement corpus."
( Growth is presented in four differentiated categories to clearly convey the underlying risk--return characteristics, thereby enabling subscribers to make informed decisions in planning their retirement journey )
Indian Life Insurance Companies who are licensed by Insurance Regulatory and
Development Authority (IRDA) are empaneled by PFRDA to act as Annuity Service
Providers to manage funds (allocated for buying annuity) and payment of pension.
The following Annuity Service Providers are empaneled :
Aditya Birla Sunlife Insurance
Company Ltd
Bajaj Allianz Life Insurance
Company Ltd.
Canara HSBC Oriental Bank of
Commerce Life Insurance Company Ltd.
Edelweiss Tokio Life Insurance
Company Ltd.
HDFC Life Insurance Co. Ltd.
ICICI Prudential Life Insurance Co.
Ltd.
India First Life Insurance Co. Ltd.
Kotak Mahindra Life Insurance Co.
Ltd.
Life Insurance Corporation of India
Max Life Insurance Co. Ltd.
PNB Metlife India Insurance Company
Ltd.
SBI Life Insurance Co. Ltd.
Shriram Life Insurance Co Ltd
Star Union Dai-ichi Life Insurance
Co. Ltd.
Tata AIA Life Insurance Company
Ltd.
For detailed information, please contact our Branches or visit the following
websites:
For Subscribers joining between 18 – 60 Years
Upon attainment of age of 60 years: Atleast 40% of the accumulated pension
wealth of the subscriber needs to be utilized for purchase of an annuity providing
for the pension and the balance is paid as a lumpsum payment. If the total corpus is
less than or equal to Rs.5.00 Lakhs, the subscriber may opt for 100% lumpsum
withdrawal. However, the subscriber has the option to defer the lumpsum withdrawal
till the age of 75 Years. Subscriber has also got the option to continue
contributing upto the age of 75 Years.
At any time before attaining the age of 60 Years: The subscriber may exit
from NPS before attaining the age of 60 Years, only if he / she has completed 5
years in NPS. Atleast 80% of the accumulated pension wealth of the subscriber needs
to be utilized for purchase of annuity and the balance is paid as a lumpsum payment
to the subscriber. In case, the total accumulated corpus is less than Rs.2.50 Lakh,
the subscriber may opt for 100% lumpsum withdrawal.
Death of Subscriber: In such an unfortunate event, option will be available
to the nominee to receive 100% of the NPS pension wealth in lumpsum/Pension.
For Subscribers joining between 60 – 70 Years
Normal Exit: The Subscriber exiting after completion of 3 years from the date
of joining NPS would be treated as Normal Exit. The subscriber will be required to
annuitize atleast 40% of the corpus for purchase of annuity and the remaining corpus
can be withdrawn in lumpsum. If the total corpus is less than or equal to Rs.5.00
Lakhs, the subscriber may opt for 100% lumpsum withdrawal.
Premature Exit: An exit before completion of 3 years from the date of joining
NPS will be treated as premature exit. In such case, the subscriber will be required
to annuitize atleast 80% of the corpus for purchase of annuity and the remaining
corpus can be withdrawn in lumpsum. In case, the total accumulated corpus is less
than Rs.2.50 Lakh, the subscriber may opt for 100% lumpsum withdrawal.
Death of Subscriber: In such an unfortunate event, option will be available
to the nominee to receive 100% of the NPS pension wealth in lumpsum.
The subscriber wishing to exit from NPS has to submit a Withdrawal Application
Form to the concerned POP along with the documents specified below for
withdrawal of the benefits.
PRAN card in original
Attested copy of proof of identity
Attested copy of proof of address
Cancelled cheque or Bank Certificate
The POP would authenticate the documents and forward them to Central
Record-keeping Agency (CRA) CRA in turn would register the claim and forward the
necessary application form along with the procedure to be followed further. Once
the documents are received, CRA processes the application and settles the
account.
The Withdrawal process may also be initiated online.
Why NPS Vatsalya?
NPS Vatsalya is a contributory pension scheme, part of the National Pension
System (NPS), designed specifically for minor children. It allows parents or
guardians to open a pension account for their children and contribute towards
their retirement savings while they are minors. The goal is to encourage early
savings and create a culture of financial planning from a young age. It's main
objective is to create a pensioned society and encourage children by inculcating
the habit of saving from an early age.
Who can join?
NPS Vatsalya is open to all citizens of India who are under the age of eighteen
years. The account will be opened and operated by the Parents / legal guardian
on behalf of the minor.
Benefits of NPS Vatsalya
NPS Vatsalya can be an immortal gift of parents to their Kids ensuring their
children's financial security even in their absence. By contributing to the
Vatsalya account from a young age, children can potentially accumulate a
significant amount by the time they retire, offering them a strong financial
foundation. Additionally, it can instil financial discipline and responsibility
in children from an early age.
Fee Structure
The charges and fee to be levied on the account at any time shall be same as the
charges under NPS-All Citizen Model, as stipulated by PFRDA from time to time.
NPS Vatsalya – Withdrawal Guidelines
Partial Withdrawal (Before Age 18)
Allowed after 3 years of account
opening.
Up to 25% of contributions
(excluding returns).
Permitted 3 times during tenure.
Valid reasons include:
Child's education
Treatment of specified illnesses
Disability of child (≥ 75%)
On Attaining 18 Years (Account Conversion)
Account automatically converts to a
regular NPS Tier I account.
Standard PFRDA Tier I rules apply.
Withdrawal at Maturity (Post-18 Tier I Rules)
If corpus > ₹2.5 lakh:
80% must go to annuity purchase.
20% can be withdrawn as lump sum.
If corpus ≤ ₹2.5 lakh:
100% lump sum withdrawal permitted.
In Case of Death (Guardian or Minor)
Entire corpus is paid to the nominee or legal guardian.
National Pension System (NPS) is a pension cum investment scheme launched by
Government of India to provide old age security to Citizens of India. It brings an
attractive long-term saving avenue to effectively plan your retirement through safe
and regulated market-based return. The Scheme is regulated by Pension Fund
Regulatory and Development Authority (PFRDA) National Pension System Trust (NPST)
established by PFRDA is the registered owner of all assets under NPS.
Any Indian Citizen (resident or non-resident) and Overseas Citizen of India (OCI)
Opening NPS account has its own advantages as compared to other pension product
available. Below are few features which make NPS different from others:
Low-cost product
Tax breaks for Individuals, Employees and Employers
Attractive market linked returns
Easily portable
Professionally managed by experienced Pension Funds
Regulated by PFRDA, a regulator set up through an act of Parliament.
No, opening multiple NPS accounts for an individual is not allowed under NPS.
However, an Individual can have one account in NPS and another account in Atal
Pension Yojana.
NPS Vatsalya is a contributory pension system under the National Pension System
(NPS). Its
objective is to create a pensioned society and encourage the empowerment of children
by
inculcating the habit of saving for retirement from an early age.
NPS Vatsalya is open to all citizens of India who are under the age of eighteen
years. The account
will be opened and operated by the guardian on behalf of the minor.
Opening a NPS Vatsalya account provides the child with a head start on saving for
retirement and
offers valuable financial lessons from an early age. It instils the importance of
financial planning and
discipline, which can benefit the child throughout their life.
The account is opened by the natural or legal guardian in the name of the
minor.
The minor is the sole beneficiary of the account.
A unique Permanent Retirement Account Number (PRAN) is issued in the minor's
name.
The account is operated by the guardian for the exclusive benefit of the
minor until they
reach the age of majority (18 years).
ESCALATION MATRIX FOR NPS SERVICESESCALATION MATRIX FOR NPS
SERVICES
