The Pension Fund Regulatory Development Authority (PFRDA) has made some changes with relation to investment in the National Pension System as part of its investor protection efforts.

Here’s a list of the changes as they stand on November 1, 2022.

1] SIP In NPS: Now, you can start a systematic investment plan (SIP) for NPS through online (D-Remit) or offline, points of presence (PoPs) facilities. You need to have an active NPS account with a valid permanent retirement account number (PRAN) and an updated mobile/email ID details. In addition, you will also need an active net banking facility in your registered bank account, with RTGS/IMPS/NEFT facility. Besides, your bank should also support the e-mandate process or standing instruction (SI) functionality.

2] Open NPS Using DigiLocker: Now, it is possible for an individual to open an NPS account by using the details of his/her driving license stored on DigiLocker platform. The same can also be used for updating details such as address on the NPS account. They will have to use the Protean CRA portal, which, is maintained by the National Securities Depository Limited (NSDL) for both opening a new NPS account as well as updating the address on the existing NPS account.

3] Proposal For Systematic Lumpsum Withdrawal: The PFRDA had proposed changes to its guidelines in a bid to allow NPS subscribers the facility of Systematic Lumpsum Withdrawal (SLW). Under the proposal of the ‘smart withdrawal facility’, an NPS subscriber can withdraw the amount either monthly, quarterly, half-yearly, or annually for up to 75 years. This facility can be availed upon a one-time request through online or offline mode.

4] Digital Life Certificate: The Insurance Regulatory Development Authority of India (IRDAI) has advised insurance companies to simplify the life certificate submission process. In this regard, it has asked companies to adopt Aadhar-based authentication for verification of life certificates, such as Jeevan Bima.

5] No Separate Form For Buying Annuity Plan: The IRDAI has relaxed the need for submitting a separate proposal for buying annuity products at maturity, in a move to smoothen the onboarding process for NPS investors. Previously, NPS investors had to submit an exit form to PFRDA along with a detailed proposal form to the life insurance company for buying an annuity plan to receive pension. Henceforth, the exit form of the NPS will be treated as the proposal form for purchasing annuities from life insurance companies.

6] 30-Day NPSE-Nomination Process Flow: The PFRDA has also modified the process of e-nomination for government and private sector employees. Now, the nodal office will have an option to either accept or reject the e-nomination request once it is initiated. Where the nodal officer fails to act on the request within 30 days of its submission, the e-nomination request will be accepted in the central recordkeeping agency.

7] No Credit Card Payment Facility For NPS Tier-2 Account Holders: NPS account holders can now no longer make contribution to their tier-2 accounts through credit cards. The PRFDA issued this guideline through an official notification this year, asking all points of presence (PoPs) to stop accepting credit cards payments for contribution to NPS tier-2 accounts with immediate effect.

8] Trail Commission Payment Through Points of Presence (PoP): The PFRDA has allowed trail commission payment through PoPs for NPS account holders. That said, the pension fund regulator has also clarified that the trail commission on NPS contributions made through D-Remit, an electronic system that directly transfers money from the bank account to the trustee bank so that the investor gets the net asset value (NAV) the same day for his/her NPS investments, would be similar to eNPS (online contribution) by subscribers who were on-boarded by the respective PoPs.