How To Open NPS Account?

NPS stands for National Pension Scheme. It is a voluntary retirement saving scheme launched by the Government of India. NPS promotes systematic savings across working life, so that you have a huge corpus at retirement.

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How To Open NPS Account?

Eligibility criteria for NPS:

• Individual must be aged between 18 to 60 years.
• Subscriber should be Know Your Customer (KYC) compliant
• Government subscribers who are mandatorily covered under NPS are not eligible.

See Also: NPS Contribution

Conditions on contribution to NPS:

• Minimum contribution should be Rs 6,000 a year.
• Amount can be made in a single installment/lump sum or in installments of a minimum of Rs 500 each month.
• There is no maximum limit for contribution to NPS.
• NPS can be withdrawn only at the age of 60.

How to open an NPS account?

You can open an NPS account in two ways:

1. By visiting POP-SP
2. Online through eNPS

1. By visiting POP-SP:

Any Indian citizen aged 18 to 65 years can open an NPS account. They can visit any Points Of Presence – Service Providers.

1. Get a Permanent Retirement Account Number (PRAN) application form from any Point of Presence - Service Providers (POP-SP) or from the NSDL website. The link is: https://www.npscra.nsdl.co.in/steps-to-join-nps.php.
2. Fill the PRAN application form, submit a photograph and submit the duly filled PRAN application form to your nearest POP-SP.
3. Submit KYC documents like identity, address proof along with the application form.
4. A minimum amount of Rs 500 is to be paid at the time of application. Submit NCIS (instruction slip) mentioning the details of your payment.
5. Central Recordkeeping Agency (CRA/eNPS) will send the PRAN card to your permanent address.
6. You can track the status of your PRAN application by entering your receipt number given in https://cra-nsdl.com/CRA/pranCardStatusInput.do.

2. Online through eNPS:

There are two ways of opening an NPS account online through eNPS:

Option 1: Registration using Aadhaar

1. An applicant must have an ‘Aadhaar number’ and a mobile number registered with Aadhaar for KYC purposes. OTP will be sent to the mobile number registered with Aadhaar.
2. Your photo and demographic details will be fetched from the Aadhaar database and populated in the online form.
3. Fill up the mandatory details online.
4. Upload your scanned signature in .jpeg/.jpg format. The file size should be between 4KB – 12KB.
5. On being routed through a payment gateway, make the payment towards NPS account through Debit Card, Credit Card and Internet Banking.

Option 2: Registration using PAN

1. For this option, you must compulsorily have a Permanent Account Number (PAN).
2. Select a bank where you have an account among the list of empanelled banks for KYC verification.
3. The bank does the KYC verification.
4. Details like name and address provided during registration, should match with bank records.
5. Fill all mandatory details online. Upload scanned photograph and signature in .jpeg/.jpg format with file size between 4KB – 12KB.
6. On being routed through a payment gateway, make the payment towards your NPS account through Internet Banking.

SEE ALSO: Types Of Investment Plans

NRI subscribers:

1. Select your Bank Account Status, whether Non-Repatriable or Repatriable.
2. Provide your NRE or NRO bank account details.
3. Upload the scanned copy of your passport.
4. Select the address for communication; this could be an overseas address or permanent address.
5. After a Permanent Retirement Account Number (PRAN) is allotted, a subscriber can:

Option 1: eSign

Tier I PRANs generated through Aadhaar can eSign the document by

• Selecting the 'eSign' option in the eSign/Print and courier page.
• You will receive an OTP on your mobile number registered with the Aadhaar.
• After authentication, the registration form will be eSigned.

Option 2: Print and Courier

1. Select 'Print & Courier' option in the eSign/print and Courier page.
2. Take a printout of the form, paste your photograph, and sign (not sign across the photograph) in the space provided for the signature.
3. Send the form within 90 days from the date of allotment of PRAN to CRA at:

Central Recordkeeping Agency (eNPS)

NSDL e-Governance Infrastructure Limited,

1st Floor, Times Tower, Kamala Mills Compound,

Senapati Bapat Marg Lower Parel, Mumbai - 400 013

Failure to send the form within the prescribed time will freeze your PRAN temporarily.

Documents required for National Pension Scheme (NPS):

• Identity proof
• Residential proof
• Application form
• Original documents for verification

Advantages of investing in National Pension Scheme (NPS):

1. Fund management fee for NPS is charged at a negligible amount of 0.1%.
2. An investment as low as Rs 6,000 can be made in NPS per year.
3. Investment in NPS can be done online. You can track the performance of your funds through the e-NPS portal.
4. You can claim a tax deduction towards contribution made to NPS up to Rs 50,000 a year under Section 80CCD(1B).
5. Up to 40% of the corpus withdrawn at the time of retirement is exempt from tax.
6. Subscribers have to compulsorily invest 40% of the corpus in Pension Annuity Scheme. This gives you security in retirement and provides a pension.

See Also: Income Tax Rules for Fy 2018-19

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