Updated January 19th, 2024 at 09:50 IST
PFRDA introduces updated withdrawal rules for National Pension System effective February 1
NPS subscribers can withdraw up to 25% of their individual pension contributions, excluding the employer's contribution.
NPS new rules: The Pension Fund Regulatory and Development Authority (PFRDA) has introduced updated withdrawal rules for the National Pension System (NPS), effective February 1, 2024. Under these provisions, NPS subscribers are limited to withdrawing a maximum of 25 per cent of their individual pension account contributions, excluding the employer's contribution.
Triple purpose withdrawals
Partial withdrawals are allowed three times during the subscription period, and subscribers must have been part of the scheme for a minimum of three years to qualify. Eligible purposes for partial withdrawals include educational expenses for the subscriber's children, marriage, house construction, medical emergencies, skill development, or establishing a venture.
Specific circumstances, such as higher education expenses, marriage, residential property purchase or construction, medical expenses for specified illnesses, disability-related expenses, skill development, and establishment of a venture, qualify for partial withdrawals.
NPS withdrawal criteria
Key conditions for partial withdrawals include a minimum three-year NPS membership, a withdrawal limit of 25 per cent of the subscriber's total contributions, and only incremental contributions for subsequent withdrawals.
To apply for withdrawal, subscribers must submit their request to the Central Recordkeeping Agency (CRA) through the government nodal office or point of presence. The request should include a self-declaration explaining the purpose of withdrawal. In case of illness, a family member can submit the withdrawal request on behalf of the subscriber. Upon receiving the request, the Point of Presence or Government Nodal Office will verify and process the withdrawal.
Published January 19th, 2024 at 09:50 IST