NPS: Can NRIs invest in the National Pension System?

The National Pension System (NPS) is a voluntary pension scheme that is accessible to all Indian citizens aged between 18 and 70 years. In 2004, the scheme was initially launched for only government employees while it was extended to all Indian citizens in 2009. The NPS scheme has been designed to provide retirement benefits to all investors. The investors can withdraw 60 per cent of the accumulated fund as a lump sum and choose annuity options for the rest of the 40 per cent.

While the scheme is accessible to all Indian citizens, people often wonder if Non-resident Indians (NRIs) are eligible to invest in it or not.  The NRIs should know a few important details regarding their investment in the NPS scheme.

Can NRIs invest in the National Pension Scheme?

NRIs like any other Indian citizen can enjoy the benefits of the NPS scheme. While an NRI gets almost all benefits of the NPS scheme, they are restricted from contributing to the NPS Tier II account and can only contribute towards the mandatory NPS Tier I account. However, it is necessary that they meet the eligibility criteria and complete the KYC formalities to open an NPS account successfully.

Any NRI aged between 18 and 70 years can invest in NPS. After completing the KYC verification the NRI investors can obtain a Permanent Retirement Account Number (PRAN) and start investing in NPS.

For KYC purpose the NRI investors need to submit their Aadhaar number linked to registered mobile number, a copy of signature, non-resident ordinary account details, PAN, cancelled cheque and a copy of the Passport.

How can an NRI open an NPS account?

An NRI can open an NPS account by following the below-mentioned steps.

• Registration via the Pension Fund Regulatory and Development Authority (PFRDA) portal using the eNPS option and choosing the NRI option.
• Choosing the fund manager and mode of investment of active or auto.
• Uploading scanned copies of required documents, such as the Aadhaar card, PAN card, Passport, digital signature, Photograph, and a cancelled cheque.
• Making the minimum payment of Rs 500 through their bank's netbanking facility. There is no upper limit of NPS investment for the NRI investors.
• The application needs to be authenticated within 90 days of the allotment of PRAN number. The NRI investor can opt for the e-sign option and authenticate using the OTP sent on registered mobile number. On the other hand, the investor can print the application; sign it and courier it to the bank responsible for opening the NPS account.