National Pension System Benefits & Features

Flexibility

  • NPS offers a range of investment options and choice of Pension Fund Manager (PFMs) for planning the growth of your investments in a reasonable manner and see your money grow. Individuals can switch over from one investment option to another or from one fund manager to another, subject, of course, to certain regulatory restrictions. The returns are totally market related.
    Flexibility to choose between 8 Fund Managers:

    The subscribers can choose between 7 Fund Managers namely-

    1. ICICI Prudential Pension Fund Management Co. Ltd.
    2. HDFC Pension Management Co. Ltd.
    3. Kotak Mahindra Pension Fund Ltd.
    4. LIC Pension Fund Ltd.
    5. SBI Pension Funds Pvt. Ltd
    6. UTI Retirement Solutions Ltd
    7. Birla Sunlife Pension Management Limited

    One Fund Manager must compulsorily be selected.

  • Flexibility to choose between Active and Auto Choice for distribution:
    A subscriber must choose between active choice and auto choice for distribution of his contribution. If active choice is selected, the subscriber must indicate the percentage distribution between corporate, gilt and equity. The maximum investment allowed in equity is 75%.

 

  • Simple: Opening an account with NPS provides a Permanent Retirement Account Number (PRAN), which is a unique number and it remains with the subscriber throughout his lifetime. The system is structured into two tiers:
    1. Tier-I account: This is the non withdrawal Permanent Retirement Account in which the accumulations are deposited and invested as per the option of the subscriber.
    2. Tier-II account: This is a voluntary withdrawal account which is allowed only when there is an active Tier I account in the name of the subscriber. The withdrawals are permitted from this account as per the needs of the subscriber as and when claimed.

Portable

NPS provides seamless portability across jobs and across locations, unlike all current pension plans. It would provide hassle-free arrangement for the individual subscribers.

Regulated

NPS is regulated by PFRDA, with transparent investment norms, regular monitoring and performance review of fund managers by NPS Trust.