The National Pension System (NPS) is a government offered retirement cum pension scheme. By investing in NPS, the investors get the dual benefit of tax-saving and retirement planning. Contribution towards an NPS account provides a benefit to individuals by way of a deduction under Section 80C.  Not just it secures your retirement planning, but it also saves taxes of up to Rs 1,50,000 a year. The best part is both private and government employees can invest in this retirement planning scheme.  

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Now on maturity, the Pension Fund Regulatory and Development Authority (PFRDA) has allowed subscribers to withdraw the entire accumulated pension wealth without purchasing an annuity if the pension amount is less than Rs 5 lakh. Currently, the person can withdraw up to 60 per cent of the amount accumulated in the account, while the rest 40 per cent is used to purchase an annuity plan.

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Anyone in the group of 18-65 years can invest in this. The minimum amount to invest in their NPS account is Rs 1,000. A person can get additional tax deduction of Rs 50,000 under Section 80CCD (1B).  He can claim a tax deduction of up to 20 per cent of his salary contributed towards NPS. Interestingly, the returns earned on NPS are exempted from taxation. The account is matured once the investor retires or attains the age of 60 years.  

The returns on NPS are not fixed unlike Public Provident Fund (PPF), Employees' Provident Fund (EPF), Voluntary Provident Fund (VPF). As the returns are completely market-driven and dependent upon your fund manager's performance and the asset mix that you select. Any individual can open a pension account under NPS through eNPS using one of the following options. 

Registration using Aadhaar Offline e-KYC 

  • Subscriber must have Aadhaar Registered Mobile Number 
  • Upload Aadhaar Paperless Offline e-KYC ZIP file. If Zip File is not generated, download from UIDAI website.  
  • Enter the Share code of 4-characters created at UIDAI website 
  • Demographic details (Name, Gender, Date of Birth, Mobile no., Address and Photo) will be fetched from Aadhaar Offline e-KYC Zip after Successful authentication and other mandatory details need to be filled up online.  
  • Upload scanned copy of PAN card and Cancelled Cheque  
  • Upload scanned Signature  
  • You will be routed to a payment gateway for making the payment towards your NPS account from Internet Banking 
  • Process for eSign or Print and Courier the registration form to CRA.  
  • Contributions are credited in PRANs on T+2 basis  

Registration using PAN (KYC verification by Bank/Non-Bank POP) 

  • Subscriber must have Permanent Account Number (PAN) 
  • Bank/ Demat /Folio account details with the empanelled Bank/Non-Bank for KYC verification for subscriber registration through eNPS 
  • KYC verification will be done by the Bank/Non-Bank POP selected by you during the registration process.  
  • Name and address provided during registration should match with POP records for KYC verification. If the details don't match, the request is liable for rejection. In case of rejection of KYC by the selected POP, the applicant is requested to contact the POP 
  • Fill up all the mandatory details online 
  • Upload scanned copy of PAN card and Cancelled Cheque  
  • Upload scanned Photograph and Signature  
  • You will be routed to a payment gateway for making the payment towards your NPS account from Internet Banking 
  • eSign or Print and Courier the registration form to CRA 
  • Contributions are credited in PRANs on T+2 basis