1. What is National Pension System? The National Pension System (NPS) is a new voluntary contributory pension scheme intr oduced by the Central Government through Pension Fund Regulatory and Development Authority (PFRDA) to promote old age income securit y. It is a defined contribution pension system which is being offered on a voluntary basis to all citizens of Indi a other than government employees covered by NPS. PFRDA has also introduced Corporate National Pension System model (under existing All Citizen of India Model (i.e. commonly known as “UOS NPS model”)) where -in the Corporate can get itself register under the System with CRA through the recognized POP. As per the Corporate NPS model the Corporate is free to offer the NPS system to all or select employees (i.e. based on certain criteria - above a certain grade). Under the Corporate NPS model, the Corporate can transfer Employee’s contribution (i.e. deduction from employee’s salary) to Employee’s NPS Tier I a ccount and it also has an option to contribute over and above the employee’s NPS contribution amount. Under the NPS, individuals can open a personal retirement account with t he government through PFRDA and can set aside and save a pension cor pus during their work life to meet financial needs after retirement. These contributions earn returns depending on the i nvestment option selected by the i ndividual. At the time of withdrawal, the subscribers have to i nvest a portion of t heir accumulated pension wealth under the NPS to purchase a life annuity from an IRDA regulated life insurance company and the bal ance may be withdrawn in lumpsum. The amount and the time period after which withdrawals can be made are subject to certai n conditions (as explained in FAQs ). To view the NPS offer document visit https://www.npscra.nsdl.co.in/offer-documents.php 2. What is the architecture of NPS? Who are the different entities involved? Following are the Intermediaries in the NPS system: Pension Fund Regulatory and Development Authority(PFRDA) Centr al Record-keeping Agency (CRA) National Securities Depository Limited (NSDL) has been appointed as the CRA for NPS by PFRDA . Pension Funds (PFs)/Pension Fund Managers ( PFM) Annuity Service Provider (ASP) Trust & Trustee Bank (TB) Point of Presence (P oP) Custodian · Description of the above entities : · Pension Fund Regulatory and Development Authority (PFRDA) PFRDA is the regulator for the NPS. PFRDA is responsible for registration of various intermediar ies in the system such as Centr al Record Keeping Agency (CRA), Pension Funds, Custodians, NPS Trustee Bank, etc. PFRDA shall also monitor the performance of the
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1. What is National Pension System?
The National Pension System (NPS) is a new voluntary contributory pension scheme
introduced by the Central Government through Pension Fund Regulatory and
Development Authority (PFRDA) to promote old age income security.
It is a defined contribution pension system which is being offered on a voluntary basis
to all citizens of India other than government employees covered by NPS. PFRDA has
also introduced Corporate National Pension System model (under existing All Citizen of India
Model (i.e. commonly known as “UOS NPS model”)) where -in the Corporate can get itself
register under the System with CRA through the recognized POP. As per the Corporate NPS
model the Corporate is free to offer the NPS system to all or select employees (i.e. based on
certain criteria - above a certain grade). Under the Corporate NPS model, the Corporate can
transfer Employee’s contribution (i.e. deduction from employee’s salary) to Employee’s NPS
Tier I account and it also has an option to contribute over and above the employee’s NPS
contribution amount.
Under the NPS, individuals can open a personal retirement account with the government
through PFRDA and can set aside and save a pension corpus during their work life to
meet financial needs after retirement. These contributions earn returns depending on
the investment option selected by the individual.
At the time of withdrawal, the subscribers have to invest a portion of their accumulated
pension wealth under the NPS to purchase a life annuity from an IRDA regulated life
insurance company and the balance may be withdrawn in lumpsum. The amount and the
time period after which withdrawals can be made are subject to certain conditions (as
explained in FAQs).
To view the NPS offer document visit
https://www.npscra.nsdl.co.in/offer-documents.php
2. What is the architecture of NPS? Who are the different entities involved? Following are
the Intermediaries in the NPS system:
Pension Fund Regulatory and Development Authority(PFRDA) Central Record-keeping Agency (CRA) National Securities Depository Limited (NSDL) has been appointed as the CRA for NPS
by PFRDA. Pension Funds (PFs)/Pension Fund Managers (PFM) Annuity Service Provider (ASP) Trust & Trustee Bank (TB) Point of Presence (PoP) Custodian
· Description of the above entities :
· Pension Fund Regulatory and Development Authority (PFRDA)
PFRDA is the regulator for the NPS. PFRDA is responsible for registration of various
intermediaries in the system such as Central Record Keeping Agency (CRA), Pension Funds,
Custodians, NPS Trustee Bank, etc. PFRDA shall also monitor the performance of the
various intermediaries and ensure that all stakeholders comply with the
guidelines/regulations issued by PFRDA from time to time.
· Central Record-keeping Agency (CRA)
The record-keeping, administration and customer service functions for all subscribers of
the National Pension System will be centralized and performed by the CRA. The CRA
shall, on the basis of instructions received from subscribers, transmit such instructions
to the appointed Pension Funds on a regular basis. The CRA will also provide
periodic, consolidated PRAN statements to each subscriber. Currently National Securities
Depository Ltd (NSDL) is CRA.
· Pension Funds (PFs)/Pension Fund Managers (PFMs)
Appointed PFs are responsible for managing the retirement savings of subscribers
under the NPS. The PFRDA has appointed a limited number of leading professional firms to
act as PFMs. Subscribers contribution is given to these PFMs for further investment.
The PFMs are required to invest strictly in accordance with the guidelines issued by the
government / PFRDA. PFMs would communicate the NAV of each scheme to CRA on a
regular basis.
NPS allows you to choose from any one of the following 7 entities as PF to manage your
No. You will not be able to register for NPS, unless you have indicated your
Investment choice.
Further, incase you have selected the Active choice option but if you have not indicated the
percentage allocation of your pension wealth across the 3 asset classes or it does not
aggregate to a total of 100%, you will not be able to submit your online NPS registration
application
37. What is meant by Life Cycle fund in the Auto Choice option?
NPS offers an easy investment option, called "Auto Choice", to assist those customers who
do not have the required knowledge to manage their NPS investments.
Under this Option, the investments will be made in a life cycle fund whereby the allocation
across various assets will be defined as per your age and will be readjusted as you grow
older. Please refer the offer document for details refer "Auto choice - life cycle fund section".
38. What is the meaning of asset reallocation in the Auto Choice investment option?
If you have opted for Auto Choice, the reallocation of your pension money among the
different asset classes shall take place on your date of birth. All subsequent investments
in your NPS account shall be made as per such revised asset class allocation as stated
in the Lifecycle Fund grid (as defined by PFRDA).
39. Can I change the Pension Fund Manager for my pension savings?
Yes, you can change your Pension Fund Manager any time subject to once in a financial
year.
40. Can I have a different Pension Fund Manager and Investment Option for my Tier I and Tier II
account?
Yes. You may select different PFMs and Investment Options for your NPS Tier
I and Tier II accounts.
41. Where can I view my unit holdings held in the NPS Tier I and II account? You can view your unit holdings by logging on https://cra-nsdl.com/CRA/ (CRA site) using
the IPIN provided by CRA. You can also view the details of the "Unit Holdings" on NPS page
(SOT) of your www.icicidirect.com trading / investment account.
42. Will I receive a transaction statement on allotment of units in my NPS account?
Yes. An annual statement containing details of your unit holdings will be issued by CRA
to your registered address within 3 months of the end of every financial year.
43. Are there any conditions / formalities to be completed for withdrawing money from
NPS account holders will have to comply with the regulations stated in PFRDA (exit &
Withdrawals under the National Pension system) Regulations, 2015.
As per the said Regulations, the NPS account holder has an option to exit & withdraw from
National Pension System under the following scenarios viz. i) On attending 60 years of age
or on attending superannuation age and ii) at any time before attending the age of 60 years.
Following are the conditions stipulated by PFRDA for withdrawing funds from the NPS Tier I
account:
Vesting Criteria Benefit On attaining age of 60 years and upto 70 years of age
On exit, you would be required to compulsorily invest at least 40 % of your accumulated savings (pension wealth) to purchase a life annuity from any IRDA - regulated life insurance company. Note: Annuity purchase can also be deferred for maximum period of 3 years at the time of exit.
The remaining pension wealth can be withdrawn in lump sum on attaining the age of 60 y e a r s
N o t e : PFRDA clarification on deferment
of withdrawal of eligible lumpsum
amount: As per PFRDA circular No.
PFRDA/2015/24/EXITS/1 dated the
October 29, 2015, PFRDA has given an
option to the NPS account holder (on
attending the age of 60 years) that he can
deferred his eligible lumpsum amount in
maximum ten annual installments up to
the age of 70 years or he can withdraw
the entire amount at once by giving 15
days advance notice, If the NPS account
holder has not given any advance
deferrement notice then the accumulated
pension amount would be automatically
monetized and credited to the NPS
account holder bank account upon
attaining the age of 70 years,
44. What will happen to my savings if I decide to retire before age 60?
To withdraw from your Tier I account before 60 years of age, you would be required to
invest at least 80% of your pension wealth to purchase a life annuity (subject to fulfillment
of eligibility age criteria (if any) from any IRDA - regulated life insurance company. You
may withdraw the remaining 20% of your pension wealth as a lump sum.
(Note: Premature withdrawal only if subscriber has been in NPS for at least 10 yrs)
Partial Withdrawal :Up to 25% of own contribution for Marriage or Higher education of children or
purchase of house/flat or for prescribed illness (subject to certain conditions) if subscriber has been in NPS
for at least 10 yrs)
45. Who are the Annuity Service Providers for NPS accounts?
Pension Fund Regulatory and Development Authority (PFRDA) has empanelled the
following seven IRDA approved life insurance companies for providing annuity services to
the subscribers of National Pension System (NPS).
1. Life Insurance Corporation of India
2. SBI Life Insurance Co. Ltd.
3. ICICI Prudential Life Insurance Co. Ltd.
4. Bajaj Allianz Life Insurance Co. Ltd.
5. Star Union Dai-ichi Life Insurance Co. Ltd.
6. Reliance Life Insurance Co. Ltd.
7. HDFC Standard Life Insurance Co. Ltd.
Subscribers to the National Pension System (NPS) will now have a choice of selecting the
Annuity Service Providers, from whom they can choose their annuity schemes on their exit
from NPS on attainment of 60 years of age (where-in atleast 40% of the accumulate
amount of NPS Tier I account should be annuitised) or they can opt for the same before
attaining 60 years of age (where-in atleast 80% of the accumulate amount of NPS Tier I
account should be annuitised).
Annuity Service Providers are in process of floating the annuity schemes and
CRA shall be issuing the operational guidelines for the same.
46. Can I register a SIP request for making investment in my NPS account? How will
the SIP request work?
Yes. I-Sec offers you a facility to place a SIP request for making periodical investment in
your NPS Tier I account on www.icicidirect.com.
47. How can I register a SIP request for my NPS investment?
To place a SIP request, you will have to login to your www.icicidirect.com trading/
investment account and select the SIP option displayed on the NPS page.
Here you will be required to specify the following details:
a. Start Date: This is the date on which you want your SIP to start and your contribution to
be given to CRA. (Remember - Your SIP Start Date cannot be the date prior to the date of
For complaints, we request you to refer process as mentioned in our Grievance Redressal Policy. http://content.icicidirect.com/mailimages/Grievance_redressal_policy.pdf
You may also walk in to your nearest ICICIDirect centre to seek clarifications/
express your grievances.
Please ensure that you have mentioned your PRAN in your grievance letter.
61. Can I raise my queries / complaints directly with CRA?
Yes. The NPS also has a multi layered Grievance Redressal Mechanism which is easily
accessible, simple, quick, fair, responsive & effective. You can register your grievance /
compliant by calling at the CRA call centre at toll free telephone number 1-800-
222080 or by registering the grievance on https://cra-nsdl.com.
You will have to authenticate yourself through the use of T-PIN (in case of call centre) /I-PIN
(while registering on the site) allotted to you.
On successful registration of your grievance, a token number will be allotted to you for all
future references.
62. How can I track the status of resolution of my grievance that I have registered
with CRA?
You can check the resolution status of your grievance by logging in to the