NPS Scheme: PFRDA may allow pensioners to withdraw entire lifetime contribution soon- CHECK details

The Pension Fund Regulatory and Development Authority (PFRDA) may allow pensioners to withdraw their entire lifetime contribution to National Pension System (NPS) with a higher threshold.

This move is expected to benefit lakhs of pensioners as the amount can help them during emergencies or can also be invested into some other schemes.

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As per an IANS report, quoting sources in the government, NPS account holders may be allowed to withdraw their entire money at one go if pension corpus is up to Rs 5 lakh. PFRDA is working on this option, said the report.

Current withdrawal limit?

At present, the limit is Rs 2 lakh up to which an NPS subscriber can withdraw the entire money.  Beyond this limit, currently, only 60 percent of pension corpus could be withdrawn while 40 percent of the contributions have to be mandatorily parked in government-approved annuities.

Plan to increase the withdrawal limit to Rs 5 lakh

According to the report, the plan is to increase the threshold to Rs 5 lakh that will offer better liquidity to certain segment subscribers.

Who can open National Pension System (NPS) Account?

To become an NPS account holder an individual citizen of India can be both resident and Non-resident in the age group of 18-65 years as on the date of submission of the NPS application.

However, you need to note that an individual cannot open multiple NPS accounts. Also, an NPS account can be opened only in an individual capacity and cannot be opened or operated jointly or for and on behalf of HUF.