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SBI National Pension Scheme

National Pension Scheme for every Indian citizen was introduced from May 1, 2009 by the
Pension Fund Regulatory and Development Authority as an initiative to provide the elder
with old age pension security who are between the age group of 18 to 60 years. The main
intention of this account is to allow elders to enjoy a reasonable market based returns over
a long period of time. SBI is one of the banks where you can open SBI national pension
scheme an account.

Eligibility Criterias for SBI National Pension Scheme

Here are some of the most important eligibility criteria for the individual to apply for the
SBI National Pension Scheme:

1. To open this account, the individual should be between the age of 18 to 60 years.

2. Based on the KYC norms the following documentation are required:

o Photo Id proof

o Date of birth proof

o Address proof

o Application form

3. In case of Tier I:

o Minimum contribution for account opening is Rs.500

o Minimum amount payable for every contribution is Rs. 500

o Minimum Required Account Balance at the end of every financial year is Rs. 6,000

o Minimum number of contributions per annum should be at least once.

4. In case of Tier II:

o Minimum contribution for account opening is Rs.1,000

o Minimum amount payable for every contribution is Rs. 250

o Minimum Required Account Balance at the end of every financial year is Rs. 2,000
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o Minimum number of contributions per annum should be at least once.

5. For a Tier II account opening, the individual has to first open an active Tier I account for
activating the Tier II account.

6. Minimum contribution at the time of account opening is Rs. 1500 when a composite
application is being made for Tier I and Tier II together.

7. Submission of a cancelled cheque is required for composite application or Tier II or

Composite application with the application form.

Charges Levied for SBI National Pension Scheme

Here are the applicable charges of subscription for the account:

1. Initial Subscriber Registration Charges per person: Rs. 100

2. Initial Contribution amount for every individual per subscriber where an ad valorem of
0.25% of the initial contribution amount needs to be paid. The minimum contribution
should be Rs. 20 and the maximum can be up to Rs. 25,000.

3. Subsequent Contribution for Transaction Charges for every subscriber where an ad valorem
of 0.25% of the initial contribution amount needs to be paid. The minimum contribution
should be Rs. 20 and the maximum can be up to Rs. 25,000.

4. For other transactions that are not for subscribers is Rs. 20.

Benefits Of SBI National Pension Scheme

The main benefit based on the Swavalamban guidelines that had been approved by the
Government of India, is that all NPS accounts opened between 2010 and 2011, 2011 and
2012 and 2012 and 2013 are eligible for Rs.1,000 benefit from the Government as long as
the prescribed eligibility criterias have been fulfilled.

Features of SBI National Pension Scheme

The following are the salient features for both Tier I and Tier II

The accounts can be opened at Point of Presence-Service Provider (POP-SP)banks who

accept the application form and the required documents getting the subscribers registered
with Central Record keeping Agency (CRA) to generate the Permanent Retirement Account
Number (PRAN).

The PRAN will be needed for quoting in all future transactions.

There are options Tier I and Tier II.

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Tier I

This is a non-with drawable account and unless the individual reaches the age of 60 years,
they cannot withdraw the pension for the rest of the years.

The subscriber has to close the scheme he or she reaches 60 years of age. However the
individual can extend the scheme for 10 years, further under the condition that no new
contributions can be made on the scheme. Also it is mandatory to annuitize 40% of the
accumulated pension wealth. The option to annuitize 100% of the whole corpus is allowed
as well.

Tier II

A Tier-II account is an optional voluntary savings account, where the subscriber is free to
withdraw from the accumulated scheme amount any time.

The facility is available to Indian citizens of India which includes Government employees
who are mandatorily covered by NPS.

There are also no restrictions on the number of withdrawals that can be made in Tier II. Use
the NPS calculator to get an estimate of your schem amount.

The individual can also separate nomination as well as scheme preference between Tier I
and Tier II.

One-way transfer of savings between tiers is allowed.

There is no requirement for another KYC for Tier II account opening since a pre-existing
Tier I IRA Compliant account would already to active.

Who can open?

Any Indian citizen who are above 18 years old and below 60 year.

Investment charges

You will have to bear 0.010% of charges on total investment that will be paid to NPS
department.

Minimum Contribution

6,000 in every financial year

Withdrawal Rules

There are basically 2 rules when it comes to NPS withdrawal:

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o There is limitation in terms of withdrawing NPS fund. You cant withdraw more than
20% of the amount before 60 or retirement (whichever comes first).

o However you can withdraw 60% of the total investment after 60 or retirement.

Why Should I Invest in NPS?

Thats a good question. Its well known truth that the NPS is considered among the best
retirement plans in India. However the rate of interest on NPS is not fixed and might goes
up and down every financial year. However it is also the fact that the NPS is operated and
taken care of Govt. of India, therefore it is 100% safe. The NPA scheme is operated by a
separate department known as PFRDA.

Additionally it provides better returns on investment as compare to PF or EPF.

Where I can open NPS account?

Please note that the NPS is purely voluntary scheme and the main motto behind it to
provide pension after retirement. There are several ways to invest in NPS however the main
categories are mentioned below:

Central Government Scheme

State Government Scheme

Swavalamban Scheme

Additionally there are 7 top banks in India that help you to invest in NPS like:

Bank Scheme Name

HDFC HDFC Pension fund

ICICI ICICI Pension fund

Kotak Kotak Pension fund

LIC LIC Pension fund

Reliance Reliance Pension fund

SBI SBI Pension fund

UTI UTI Retirement Pension fund

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NEW PENSION SYSTEM (NPS)

1. New Pension System for every Citizen was introduced from 1st May 2009 by the Pension
Fund Regulatory and Development Authority to provide old age pension security to citizens
in the age group of 18-60. A brief detail of the Scheme (Tier I & Tier II) is as below:

NPS is a voluntary Pension System of Pension Fund Regulatory and Development

Authority (PFRDA) open to all citizens in the age group of 18-60 years.

The Scheme is operative from 01.05.2009.

The objective is to provide old age pension; reasonable market based returns over long
term

Bank designated branches i.e. Point of Presence-Service Provider (POP-SP) accept the
application form and get the subscribers registered with Central Record keeping
Agency (CRA) for generation of the Permanent Retirement Account Number (PRAN).

The PRAN will be quoted in all future transactions.

There are two models i.e. Tier I and Tier II.

Tier-I account is where you contribute your savings for retirement into a non-
withdrawable account till you reach 60 years and draw pension for the rest of your life.

In case of Tier I

Minimum contribution at the time of account opening -Rs.500/-

Minimum amount per contribution - Rs. 500/-

Minimum Account Balance at the end of FY - Rs. 6000/-

Minimum number of contributions in a year 1

The subscriber will exit the scheme after attaining 60 years of age. The subscriber has
the option to defer the withdrawal and stay invested in NPS up to 70 years of age
however the subscriber is not allowed to make further contributions. He/She has to
compulsorily annuitize 40% of the accumulated pension wealth. Option to annuitize
100% of the corpus is also available.

A Tier-II account is a voluntary savings account form the subscriber is free to withdraw
any time.

The facility of Tier II account is being offered from December 1, 2009 to all citizens of
India including Government employees mandatorily covered by NPS.
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In case of Tier II activation of Government employees, mandatorily covered by NPS, There

are two type of employees:

IRA Compliant - Those Government employees who are having PRAN Card.

INon-IRA Compliant - Those Government employees who are having only PRAN number,
not having PRAN Card. For Tier II activation of these employees KYC verification is
required.

The Tier-II would enable the existing Permanent Retirement Account (PRA) holders to
build savings through investments over and above those in the Tier I pension account.
An active Tier I account will be a pre-requisite for opening of a Tier II account.

No additional CRA charges would be levied for account opening and annual
maintenance in respect of Tier II. However, CRA will charge separately for each
transaction in Tier II, the charges being identical to the transaction charge structure in
Tier I

There are no limits on number of withdrawals in Tier II.

There is a facility for separate nomination and scheme preference in Tier I and Tier II.

There is facility of one-way transfer of savings from Tier II to Tier I.

Bank details will be mandatory for opening a Tier II account.

No separate KYC for Tier II account opening will be required; the only requirement is a
preexisting Tier I IRA Compliant account.

In case of Tier II,

Minimum contribution at the time of account opening -Rs.1000/-

Minimum amount per contribution - Rs. 250/-

Minimum Account Balance at the end of FY-Rs. 2000/-

Minimum number of contributions in a year - One

In case of Composite Application for Tier I and Tier II both, Minimum contribution at
the time of account opening is Rs. 1500/-.

2. Click here to download Subscriber Registration Form

3. The Subscriber will be informed of the Permanent Retirement Account Number (PRAN)
by the CRA. Once the CRA provides the PRAN, the subscriber can start depositing his
subscriptions through his chosen POP-SP.
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4. The CRA keeps a record of all subscriptions.

5. A subscriber has three options for his investments:

HIGH RISK HIGH RETURN: Investments in predominantly Equity Market Instruments

MEDIUM RISK MEDIUM RETURN: Investment in predominantly Fixed Income

Instruments

LOW RISK LOW RETURN: Investments in purely Fixed Income Instruments.

In case no option is given Auto Choice will be done automatically.

6. SBI PENSION FUND PRIVATE LIMITED is one of the Pension Fund Managers handling
subscription amounts.

7. Following costs are to be borne by the Subscriber at the time of registration and/or
performing any transaction. The contribution will be remitted net of bank charges.

Service
charges to be
Parameter paid to the
POP by the
Code no Phone No. Corporate
(excluding
service tax)

Initial Subscriber Registration/per

Rs .100/-
subscriber

Ad valorem
0.25% of the
contribution
amount
Initial Contribution amount / per
(Minimum:
subscriber
Rs. 20/- and
Maximum:
up to Rs.
25000/-)

Subsequent Contribution Transaction Ad valorem

Charge/ per subscriber 0.25% of the
contribution
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amount
(Minimum:
Rs. 20/- &
Maximum:
up to Rs.
25000/-)

Any other transaction not involving a

contribution from subscriber/ per Rs. 20/-
subscriber

Swavalamban Scheme benefits for NPS Account Holders:

Under the Swavalamban guidelines approved by the Government of India, all NPS accounts
opened in 2010-11, 2011-12 and 2012-13 will be entitled to the benefit of Government co-
contribution of Rs. 1,000 subject to fulfilling the prescribed eligibility criteria.

Click here to view Swavalamban operational guidelines.

The concerned NPS account holders are requested to submit the required declaration form
to the designated branch at the earliest to avail of the Swavalamban benefit.

To know more or to open an NPS account, please walk into any of the designated branch. If
you have any queries, please write to us at nps.ccmum@sbi.co.in or call at 1800112211. You
may also access the details of the scheme at pfrda.org.in.

Most Important Terms & Conditions

1. The New Pension System (NPS) is a scheme run by the Government of India and SBI is
one of the agents authorized to accept contribution and assist in opening accounts. The
returns in this scheme are entirely under the control of the PFRDA.

2. For NPS account opening, subscriber should be in the age group of 18-60 years.

3. As per KYC norms Photo Id proof, Date of birth proof and Address proof are required to
be submitted along with application form.

4. In case of Tier I:

Minimum contribution at the time of account opening -Rs.500/-

Minimum amount per contribution - Rs. 500/-

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Minimum Account Balance at the end of FY - Rs. 6000/-

Minimum number of contributions in a year 1

5. In case of Tier II:

Minimum contribution at the time of account opening -Rs.1000/-

Minimum amount per contribution - Rs. 250/-

Minimum Account Balance at the end of FY-Rs. 2000/-

Minimum number of contributions in a year 1

6. An active Tier I account will be a pre-requisite for activation of a Tier II account.

7. In case of Composite Application for Tier I and Tier II both, Minimum contribution at the
time of account opening is Rs. 1500/-.

8. In case of Tier II or Composite application, a cancelled cheque is also required to be

submitted along with the application form.

9.Following costs are to be borne by the Subscriber at the time of registration and/or
performing any transaction.

Service
charges to be
Parameter paid to the
POP by the
Code no Phone No. Corporate
(excluding
service tax)

Initial Subscriber Registration / per

Rs .100/-
subscriber

Initial Contribution amount / per Ad valorem

subscriber 0.25% of the
contribution
amount
(Minimum:
Rs. 20/- and
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Maximum:
up to Rs.
25000/-)

Ad valorem
0.25% of the
contribution
amount
Subsequent Contribution Transaction
(Minimum:
Charge / per subscriber
Rs. 20/- &
Maximum:
up to Rs.
25000/-)

Any other transaction not involving a

contribution from subscriber/ per Rs. 20/-
subscriber

10. Subscriber can register only through Bank designated branches i.e. Point of Presence-
Service Provider (POP-SP).

Understanding NPS

1. What is retirement planning and how to ensure an independent life even when one
retires from active work life?

Retirement planning involves disciplined saving, vigilant investment to build a sufficient

retirement corpus and its judicious drawdown in the post-retirement phase. This is
achieved by joining a pension/retirement plan at an early stage in ones life so that when a
person retires from active work life, he gets a regular stream of income in the form of
pension or annuity for his life.

2. What are the pension plans available in India?

National Pension System (NPS) which is administered and regulated by Pension Fund
Regulatory and Development Authority (PFRDA) created by an Act of Parliament. Besides
the NPS, some mutual funds and insurance companies also offer Pension plan or retirement
plan, which are not under the jurisdiction of PFRDA. Apart from this the normal retirement
plan options include EPFO, Retirement gratuity etc. is offered by employers to their
workers and employees.
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3. What is National Pension System (NPS)?

National Pension System (NPS) is a voluntary, defined contribution retirement savings

scheme designed to enable the subscribers to make optimum decisions regarding their
future through systematic savings during their working life. NPS seeks to inculcate the habit
of saving for retirement amongst the citizens. It is an attempt towards finding a sustainable
solution to the problem of providing adequate retirement income to every citizen of India.

Under the NPS, individual savings are pooled in to a pension fund which are invested
by PFRDA regulated professional fund managers as per the approved investment
guidelines in to the diversified portfolios comprising of government bonds, bills,
corporate debentures and shares. These contributions would grow and accumulate
over the years, depending on the returns earned on the investment made.

At the time of normal exit from NPS, the subscribers may use the accumulated
pension wealth under the scheme to purchase a life annuity from a PFRDA
empanelled life insurance company apart from withdrawing a part of the
accumulated pension wealth as lump-sum, if they choose so.

4. What are the advantages in joining NPS?

Flexible- 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 being totally market-related.

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 scheme is structured into two tiers:

Tier-I account: This is the non-withdrawable permanent retirement account into

which the accumulations are deposited and invested as per the option of the
subscriber.

Tier-II account: This is a voluntary withdrawable 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.
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Portable- NPS provides seamless portability across jobs and across locations, unlike
all current pension plans, including that of the EPFO. 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.

NPS Architecture

The NPS is a sophisticated innovation that is based on the world's best practices in the
pension sector.

NPS is based on Personal retirement accounts (PRAs) created for individual

members. NPS accumulates savings into subscriber's PRA while he is working and
use the accumulations at retirement to procure a pension for the rest of his life.

NPS architecture consists of NPS Trust which is entrusted with safeguarding

subscribers interests, a Central Recordkeeping Agency (CRA) which maintains the
data and records, Point of Presence (POP) and aggregators as collection and
distribution arms, competing pension fund managers for generating and maximizing
returns on investments of subscribers, custodian to take care of the assets
purchased by the Fund managers and Trustee bank to manage the banking
operations.

NPS has an unbundled Architecture, with inbuilt checks and balances, where each
function is performed by a different entity which is renowned in its area, to achieve
maximum operational efficiency and at a low cost.

NSDL is acting as Central Record Keeping agency (CRA) which is associated with
various national level projects for recordkeeping functions.

Renowned Financial Institutions covering Public/Private Sector Banks, NBFC, etc.,

acting as POPs and Aggregators.
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Funds are managed by professional Fund Managers from Public & Private sector
with proven track record and as per the PFRDA approved investment guidelines. At
present there are 8 pension fund managers managing the pension wealth of
subscribers. They are :

o HDFC Pension Management Co. Ltd. **

ICICI Prudential Pension Fund Management Co. Ltd.

Kotak Mahindra Pension Fund Ltd.

LIC PensionFund Ltd.

Reliance Capital Pension Fund Ltd.

SBI Pension Funds Pvt. Ltd

UTI Retirement Solutions Ltd

Pension Fund (PF) to be incorporated by Birla Sunlife Insurance Co. Ltd

(** The Honble High-Court Delhi has permitted HDFC Pension Management Company Ltd.
to carry on pension fund management business till further orders.)

Axis Bank, functions as Trustee Bank.

Stock Holding Corporation of India Ltd, functions as custodian for NPS.

Benefits of NPS

Dual benefit of Low Cost and Power of compounding The account maintenance costs
under NPS are the lowest as compared to similar pension products available in India, like
retirement plans offered by Insurance companies and mutual funds. While saving for a
long-term goal such as retirement, the cost matters a lot. Over 35-40 years, the charges can
shave off a significant amount from the corpus.
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Till the retirement pension wealth accumulation grows over a period of time with a
compounding effect.The account maintenance charges being low, the benefit of
accumulated pension wealth to the subscriber eventually become large.

A flexible investment option: Subscribers have control on the choice of investment made
and the fund manager who manages the investments. Subscribers can switch over from
one investment option to another or from one fund manager to another subject, of course,
to certain regulatory restrictions.

Tax benefits: The first benefit of the NPS consists of the income tax deduction that is
available to the individuals when they make their own contribution to the fund. There is
an overall limit of Rs 1 lakh for contributions under eligible investments for Section 80C,
pension fund contributions (Section 80CCC) and contribution to NPS (Section 80CCD).
Apart from this, if there are co-contributions from the employer, then

Employer contributing to the NPS on behalf of an employee will get deduction from
his income (i.e. employer's income) an amount equivalent to the amount contributed
or 10% of BASIC SALARY + DA of the employee, whichever is less. (Section 36 (1) (iv
a) of the Income Tax Act 1961)

Employer's contribution to NPS on behalf of the employee is treated as perquisite in

the hands of the employees, but is deductible u/s80CCD(2) of the Income tax
Act,1961 to the extent of 10% of basic salary. This deduction is over and above the
limit of Rs.1 lac u/s 80C of the Income tax Act,1961. This will lessen the tax burden
of the employee to the extent of amount deductible u/s80CCD(2) of the Income tax
Act,1961

A safe retirement fund : Introduced by the Government of India and regulated by the
Pension Fund Regulatory & Development Authority (PFRDA).

All Citizen Model

Eligibility

A citizen of India, whether resident or non-resident, subject to the following conditions:

Applicant should be between 18 60 years of age as on the date of submission of

his/her application to the POP/ POP-SP or opening account online on eNPS platform.
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Applicant should comply with the Know Your Customer (KYC) norms as detailed in
the Subscriber Registration Form. All the documents required for KYC compliance need
to be mandatorily submitted.

Benefits to Subscriber

Low Cost - NPS is considered to be the worlds lowest cost pension scheme.
Administrative charges and fund management fee are also lowest.

Simple - All applicant has to do is to open an account with any one of the POPs or through
eNPS and get a Permanemt Retirement Account Number(PRAN)

Flexible - Applicant can choose his/her own investment option and Pension Fund or
select Auto choice to get better returns.

Portable - Applicant can operate an account from anywhere in the country and can pay
contributions through any of the POP-SPs irrespective of the POP-SP branch with whom the
applicant is registered, even if he/she changes his/her city, job etc and also make
contribution through eNPS. The account can be shifted to any other sector like Government
Sector, Corporate Model in case the subscriber gets the employment

Prudentially Regulated Transparent investment norms, regular monitoring and

performance review of funds by NPS Trust.

Tax benefit to employee:

Individuals who are employed and contributing to NPS would enjoy tax benefits on their
own contributions as well as their employers contribution as under: -

(a) Employees own contribution - Eligible for tax deduction up to 10% of Salary (Basic +
DA) under Section 80 CCD(1) within the overall ceiling of Rs. 1.50 lacs under Sec 80 CCE.

(b) Employers contribution The employee is eligible for tax deduction up to 10% of
Salary (Basic + DA) contributed by employer under Sec 80 CCD(2) over and above the limit
of Rs. 1.50 lacs provided under Sec 80 CCE.

Tax benefit for self-employed:

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Eligible for tax deduction up to 10 % of gross income under Sec 80 CCD (1) with in the
overall ceiling of Rs. 1.50 lacs under Sec 80 CCE.

Subscriber is allowed deduction in addition to the deduction allowed under Sec. 80CCD(1)
for additional contribution in his NPS account subject to maximum investment of Rs.
50,000/- under sec. 80CCD 1(B)

Tax benefits would be applicable as per the Income Tax Act, 1961 as amended from time to
time.

Enrollment

To enroll in the NPS, applicant needs to submit the Subscriber Registration Form (as
prescribed) to the POP-SP of his/her choice. Applicant can procure the subscriber
registration application form from any of the Point of Presence - Service Providers (POP-SP)
applicant wishes to register with. Alternatively the subscriber registration forms are
available at link of All Citizen Model Forms in Forms Section on our website

The applicant has to ensure that subscriber registration application form is duly filled up
i.e. photograph, signature, mandatory details, scheme preference details etc and also submit
Know Your Customer (KYC) documentation with respect to proof of identity and proof of
address. The applicant is advised to read the instructions given at the back of the form.
NRIs should have an account with a bank based in India to open an account under NPS and
also should have a local address. The contributions made by the NRI would be subject to
regulatory requirements as prescribed by RBI from time to time and FEMA requirements.
Once the application form is duly filled in applicant can go to the nearest POP-SP and
submit the PRAN application along with the KYC documents. PRAN card will be sent to
applicants correspondence address by CRA. The list of POP SP (Service Provider
branches) is available on the CRA website www.npscra.nsdl.co.in and on the website of the
concerned POP. To know the nearest POP-SP branch of your choice applicant may visit
https://www.npscra.nsdl.co.in/pop-sp.php.

After the account is opened, CRA shall mail a Welcome Kit containing the subscribers
unique Permanent Retirement Account Number (PRAN) Card and the complete information
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provided by the subscriber in the Subscriber Registration form. This account number will
be the primary means of identifying and operating the account. The applicant will also
receive a Telephone Password (TPIN) which can be used to access an account on the call
Centre number (1-800-222080). Applicant will also be provided an Internet Password
(IPIN) for accessing an account on the CRA Website (www.npscra.nsdl.co.in) on a 24X7
basis.

Account opening through eNPS Platform:

In addition to the provision of account opening through POP, the subscriber has the option
to open the account online through eNPS platform available on NPS Trust website
www.npstrust.org.in

On this eNPS platform, account can be opened either through PAN and Bank KYC
verification or through Aadhaar based eKYC verification.

In case of account opened through eKYC verification, the subscriber has option to eSign the
documents. In such case physical documents including subscriber registration form is not
required to be sent to CRA.

Types of Accounts

Tier-I account: The applicant shall contribute his/her savings for retirement into this
conditiona; & restricted withdrawable account. This is the retirement account and
applicant can claim tax benefits against the contributions made subject to the Income Tax
rules in force.

Tier-II account: This is a voluntary savings facility. The applicant will be free to withdraw
his/her savings from this account whenever he/she wishes. This is a not a retirement
account and applicant cant claim any tax benefits against contributions to this account.

Contribution

The subscriber can contribute the amount through cash, local cheque, demand draft or
Electronic Clearing System (ECS) at his/her chosen POP-SP or he has the option to
contribute through eNPS platform by net banking, debit card or credit card. However, for
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cash transactions exceeding Rs.50000/- subscriber needs to submit the copy of the PAN
card as per the Anti-Money laundering (AML) rules. Also, No outstation cheques shall be
accepted.

Minimum Contributions (For Tier-I)

Minimum contribution at the time of account opening and for all subsequent
transactions- Rs 500
Minimum contribution per year - Rs 1,000 excluding charges and taxes
Minimum number of contributions in a year - 01

Charges and Penalty for non-compliance of mandatory minimum contributions:

If the subscriber contributes less than Rs. 1,000 in a year, his/her account would be
frozen and the facilities provided by CRA such as online view of account etc. will be
restricted.
In order to reactivate the account, the subscriber would have to pay the minimum
contributions of Rs. 500/-
A frozen account shall be closed when the account value falls to zero.

Minimum Contributions (For Tier-II)

Minimum contribution at the time of account opening - Rs.1000/- and for all
subsequent transactions a minimum amount per contribution of Rs.250/-
There is no minimum contribution requirement for the financial year and also there is
no cap on maximum contribution

Minimum Contributions (For Tier-I)

Minimum contribution at the time of account opening and for all subsequent
transactions- Rs 500

Minimum contribution per year - Rs 6,000 excluding charges and taxes

Minimum number of contributions in a year - 01

Charges and Penalty for non-compliance of mandatory minimum contributions:

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If the subscriber contributes less than Rs. 6,000 in a year, his/her account would be
frozen and further transactions are allowed till the account is reactivated.

In order to reactivate the account, the subscriber would have to pay the minimum
contributions, along with penalty of Rs.100 per year of default due for the period of
dormancy.

A frozen account shall be closed when the account value falls to zero.

Minimum Contributions (For Tier-II)

Minimum contribution at the time of account opening - Rs.1000/- and for all
subsequent transactions a minimum amount per contribution of Rs.250/-

Minimum Account Balance at the end of Financial Year - Rs.2000/- excluding

charges and taxes

Minimum number of contributions in a year 01

Charges and Penalty for non-compliance of mandatory minimum contributions:

Penalty of Rs. 100/- to be levied on the subscriber for not maintaining the minimum
account balance and/or not making the minimum number of contributions.

Investment choices

Under NPS, how the money is invested will depend upon subscribers own choice. NPS
offers a number of funds and multiple investment options to choose from. In case
subscriber does not want to exercise a choice, his/her money will be invested as per the
Default choice of Moderate Life Cycle Fund under "Auto Choice" option, where money will
get invested in various type of schemes as per subscribers age. The NPS offers two
approaches to invest subscribers money:
Active choice - Individual Funds (Asset Class E, Asset Class C, and Asset Class G and
Asset ClassA )

Subscriber will have the option to actively decide as to how his/her NPS pension wealth is
to be invested in the following three options:
Asset Class E - Investments in predominantly equity market instruments.
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Asset Class C- investments in fixed income instruments other than Government securities.
Asset Class G - investments in Government securities.

Asset class A: Investment in Alternative Investment Schemes including instrument like

CMBS, MBS, REITS, AIFs, InvIts etc.

Subscriber can choose to invest his/her entire pension wealth in C or G asset classes and up
to a maximum of 50% in equity (Asset class E) and upto a maximum of 5% in asset class A.
Subscriber can also distribute his/her pension wealth across E, C, G and A asset classes,
subject to such conditions as may be prescribed by PFRDA.

Auto choice - Lifecycle Fund

NPS offers an easy option for those participants who do not have the required knowledge to
manage their NPS investments. In case subscribers are unable/unwilling to exercise any
choice as regards asset allocation, their funds will be invested in accordance with the Auto
Choice option.

In this option, the investments will be made in a life-cycle fund. Here, the proportion of
funds invested across three asset classes will be determined by a pre-defined portfolio
(which would change as per age of subscriber), with the investment in E decreasing and in
C & G increasing with the age of the subscriber.

Three Life Cycle funds are available under this Auto Choice:

(i) LC75 Aggressive Life Cycle Fund: In this Life Cycle Fund, the exposure in Equity
Investments starts with 75% till age 35 and gradually reduces as per the age of the
subscriber.

(ii) LC50- Moderate Life Cycle Fund: In this Life Cycle Fund, the exposure in Equity
Investments starts with 50% till age 35 and gradually reduces as per the age of the
subscriber.

(iii) LC 25- Conservative life cycle fund: In this Life Cycle Fund, the exposure in Equity
 21

Investments starts with 25% till age 35 and gradually reduces as per the age of the
subscriber.

The default auto choice if the subscriber is not choosing any of the above option is
Moderate life Cycle Fund.

Terms & Conditions

The subscribers personal information will not be disclosed to a third party (outside
National Pension System (NPS) which includes Annuity Service Providers empanelled by
PFRDA) without the express or implied consent of the subscriber. The information may be
used internally or for creating awareness (telephonic/written) of new services of NPS.
However, there are some exceptions, viz. disclosure of information under compulsion of
law, where there is a duty to the public to disclose and where interest of the NPS requires
disclosure.

Withdrawal/Exit

A. Upon attainment of the age of 60 years :

At least 40% of the accumulated pension wealth of the subscriber needs to be utilized for
purchase of annuity providing for monthly pension to the subscriber and balance is paid as
lump sum payment to the subscriber. In case the total accumulated corpus is less than Rs. 2
Lacs, the subscriber may opt for 100% lumpsum withdrawal.

However, the subscriber has the option to defer the lump sum withdrawal till the age of 70
years. Subscriber has also got the option to continue contributing upto the age of 70 years.
This option is required to be exercised upto 15 days prior to completion of 60 years.

B. At any time before attaining the age of 60 years:

The subscriber may exit from NPS before attaining the age of 60 years, only if he has
completed 10years in NPS. At least 80% of the accumulated pension wealth of the
subscriber needs to be utilized for purchase of annuity providing for monthly pension to
the subscriber and the balance is paid as a lump sum payment to the subscriber.
 22

In case the total accumulated corpus is less than Rs. 1 Lac, the subscriber may opt for
100% lumpsum withdrawal

C. Death of the subscriber:

In such an unfortunate event, option will be available to the nominee to receive 100% of the
NPS pension wealth in lump sum. However, if the nominee wishes to continue with the NPS,
he/she shall have to subscribe to NPS individually after following due KYC procedure

Under National Pension System, PFRDA has entrusted the responsibility of receiving,
processing and settlement of all withdrawal claims made to Central Recordkeeping Agency
(CRA) and CRA has created a special NPS claim processing cell (NPSCPC) for this purpose
for handling all types of withdrawal claims. The CRA will monitor the performance of
NPSCPC on the withdrawal processing as per the instructions provided by PFRDA in this
regard. At present the NPSCPC is fully functional.

The subscribers can submit their claims online for withdrawal from NPS

Charges
NPS offers Indian citizens a low cost option for planning their retirement. NPS perhaps is
the worlds lowest cost retirement savings product. Following are the charges under NPS:

Intermed Method of
iary Charge Head Service Charge Deduction
Initial
Subscriber Rs. 125.
Registration
Initial
Contribution To be
0.25% of the contribution Min: Rs. Collected
POP All 20 & Max : Rs.25,000
Subsequent Upfront
Contribution
All Non-
Financial Rs. 20
Transaction
CRA NCRA(NSDL) KCRA(Karvy Through
) cancellation of
 23

From
Existing 01.04.20 Existing
17
Account
Opening Rs. 50 Rs. 40 Rs. 39.36
Charge
units
Annual
Maintenance Rs. 190 Rs. 95 Rs. 57.63
Charges
Per
Transaction Rs. 3.75 Rs. 3.36
Rs. 4
(Financial/No
n-Financial)
Asset
maintenance 0.0032% of AUM
Custodian (Per Annum) Through
adjustment in
Investment NAV
PF Management 0.01% of AUM
(Per Annum)

Through
Reimburseme
NPS Trust 0.01% of AUM adjustment in
nt of Expenses
NAV
Trustee Trustee Bank
No charges levied by Trustee Bank
Bank charges

Service tax and other levies, as applicable, will be levied as per the existing tax laws. There
are no additional CRA charges for the maintenance of Tier II account. Also, please note
that the fee structure may change from time to time as may be decided by PFRDA.

Exit Procedure from NPS

A subscriber can exit from National Pension System (NPS) only in accordance with PFRDA
(Exits and Withdrawals under NPS) Regulations, 2015 which are notified on 11th May,
2015. The said regulation is a comprehensive document giving details of all the benefits
that can be withdrawn under the National Pension System and the applicable conditions
thereof. The said regulation is available on our website at www.pfrda.org.in.

Withdrawal Procedure

Under National Pension System (NPS), The Central Recordkeeping Agency (CRA) has been
 24

entrusted with the responsibility of receiving instructions related to all types of

withdrawals, processing and settlement of all such claims from NPS account holders under
National Pension System. CRA has created a specific Claim Cell called NPS Claim processing
cell (NPSCPC) for processing all claims under NPS and the contact details of the same are as
given below whom the subscribers can contact for obtaining the information, forms and
procedure pertaining to the Exit and withdrawal of benefits upon exit from National
Pension System (NPS):

NPS Claim Processing Cell,

COMMUNICATION
Central Record Keeping Agency, NSDL, 4th Floor, A Wing,
ADDRESS OF CRA CLAIM
Trade World, Kamala Mills Compound, Senapati Bapat Marg,
CELL
Lower Parel, Mumbai - 4000013

022-24994512
TELEPHONE NUMBERS 022-24994862
022-249904200 (Board)

E-MAIL IDS SarvdeepS@nsdl.co.in ; Sudhanshus@nsdl.co.in

CONTACT PERSON /
Mr.Sarvdeep Singh / Mr. Sudhanshu Shekhar
PERSONS

SECOND OR SENIOR LEVEL

Mr.Prasenjit Mukherjee
CONTACT PERSON

E-MAIL ID PrasenjitM@nsdl.co.in

Subscribers / PAO / POP / AGGREGATOR can contact the personnel mentioned above in
case of any doubt / queries on the withdrawal process or any other information pertaining
to the withdrawal of benefits under NPS.

The withdrawal process for claiming the benefits under NPS is common to all the
subscribers i.e., Government employee subscribers and all others and involves the
following broad and generic steps:

1. Receipt of Withdrawal Claim Intimation from subscriber/PAO-DTO-DDO

/POP/Aggregator

2. Receipt of completed Documentation from Subscriber/ PAO-DTO-DDO

/POP/Aggregator

Withdrawal application form

 25

Original PRAN Card / notarized affidavit in case if the original is not submitted.

Photo ID proof

Residence proof

Cancelled cheque/bank certificate/copy of the bank passbook with photograph and

all the other details like IFS Code, Account no, Branch address and Code.

Direct credit mandate

Annuity application form duly filled and signed by subscriber

Death certificate in original, if the claim is for the benefits arising out of the death of
the subscriber

Legal heir certificate wherever applicable

Relieving letter and NOC, if applicable.

3. Receipt and Processing of Claim made, as per exit guidelines by CRA Claim Cell and
resulting in intimation of deficiencies / requirements, if any

Approval of Claim withdrawal by CRA Claims cell (60% 40% 100% etc) basing on
the entitlement as per NPS Exit rules.

Instructions to PFM and TB for crediting lump sum withdrawal.

Forwarding Annuity form to ASP and crediting the ASP account with the pension
wealth as per the instructions provided in the withdrawal application form by the
subscriber.

4. Intimation to Subscriber/Govt/POP on the settlement with full details. Closure of claim

as completely settled account.

Overall, the entire effort is to minimize the time required for settlement of withdrawal
claims and minimize the hardships to the NPS subscribers.

Online Withdrawal Process

Online Demo for Subscribers

Online Demo for Nodal Offices-Central Government

Online Demo for Nodal Offices-State Government

 26

FAQ Govt. Sector - DDO

FAQ Govt. Sector - PAO - DTO

FAQ UoS & Corporate - PoP

FAQ NPS Lite - Aggregator