NPS partial withdrawal rule changed, check date and what procedure to follow to avail your pension

NPS Scheme: These online applications sent by the subscribers were directly processed through the Central Recordkeeping Agency (CRA) system followed by instant bank account verification.

NPS Scheme: These rules will come to effect on January 1, 2023. (Representative image from Pixabay)

NPS Scheme: During the COVID times several people faced financial difficulties amid this, members of the national pension scheme (NPS) headed to withdraw their amount partially from it, however, the regulatory body of pension has amended some rules with respect to the withdrawal of money from the scheme.

Pension Fund Regulatory and Development Authority (PFRDA) has issued a new order regarding these NPS withdrawals, according to which customers of all government sector customers (Centre, State and Central Autonomous Body) can now submit their application for partial withdrawal (NPS Partial Withdrawal) and it will have to be submitted only to the nodal officer.

Earlier, (PFRDA) had allowed NPS subscribers in January 2021 to submit online applications for partial withdrawals with the help of self-declaration.

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These online applications sent by the subscribers were directly processed through the Central Recordkeeping Agency (CRA) system followed by instant bank account verification.

These rules will come to effect on January 1, 2023.

“PFRDA has issued a circular no: PFRDA/2021/3/SUP-ASP/3 dt.14.01.2021 on partial withdrawals under NPS through self-declaration for the benefit of subscribers as a special dispensation to cope with the Covid pandemic in order to protect the subscribers’ interest and ease the burden of nodal officers including POPs from verification and authorization. The circular also provided for the option of submission of the partial withdrawal requests by the subscribers through their nodal office/POPs as per the prevalent practice,” the regulator noted.

POP stands for Point of Presence.

NPS withdrawal rules?

Invest in NPS for at least 3 years
25% Withdrawals from the Subscriber's Total Contribution
Withdrawals possible a total of 3 times during the subscription period
Partial withdrawal is possible for some important reasons

Reasons for NPS withdrawal rules?

For higher education of children
For marriage of children
For the purchase/construction of a residential house (in specified conditions)
For the treatment of critical illness

What are the benefits of investing in NPS?

Investing in NPS gives the benefit of extra tax exemption of Rs 50,000 (NPS Benefits) under the National Pension System 80CCD (1B). You can withdraw up to 60% of the corpus deposited on maturity. The remaining amount is kept for pension or annuity.
This National Pension System Trust is supported by the Government of India and operated by the Pension Fund Regulator i.e. PFRDA under the Government of India, so it is absolutely safe to invest in it.

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National Pension Scheme (NPS)