Finance
As part of its investor protection efforts, the Pension Fund Regulatory Development Authority (PFRDA) has made some changes to investment in the National Pension System.
Here is a list of the changes as of November 1, 2022.
1] SIP In NPS: You can now start a systematic investment plan (SIP) for NPS through online (D-Remit) or offline (PoPs) facilities. You must have an active NPS account with a valid permanent retirement account number (PRAN) and up-to-date mobile/email ID information. You will also need an active net banking facility in your registered bank account, as well as RTGS/IMPS/NEFT capability. Furthermore, your bank should support the e-mandate or standing instruction (SI) functionality.
2] Open an NPS Account Using DigiLocker: An individual can now open an NPS account using the details of his/her driving license stored on the DigiLocker platform. The same method can be used to update information on the NPS account, such as the address. They must use the Protean CRA portal, which is maintained by the National Securities Depository Limited (NSDL), to both open a new NPS account and update the address on an existing NPS account.
3] Proposal for Systematic Lumpsum Withdrawal: The PFRDA proposed changes to its guidelines in order to provide Systematic Lumpsum Withdrawal to NPS subscribers (SLW). An NPS subscriber can withdraw the amount specified in the’smart withdrawal facility’ either monthly, quarterly, half-yearly, or annually for up to 75 years. This facility can be availed upon a one-time request through online or offline mode.
4] Digital Life Certificate: The Insurance Regulatory Development Authority of India (IRDAI) has advised insurance companies to streamline the submission of life certificates. In this regard, it has requested that companies use Aadhar-based authentication for life certificate verification, such as Jeevan Bima.
5] No Separate Form Required For Purchasing Annuity Plan: In order to streamline the onboarding process for NPS investors, the IRDAI has relaxed the requirement for submitting a separate proposal for purchasing annuity products at maturity. Previously, NPS investors had to submit an exit form to PFRDA as well as a detailed proposal form to a life insurance company in order to receive a pension. The NPS exit form will now be treated as the proposal form for purchasing annuities from life insurance companies.
6] Flow of the 30-Day NPSE-Nomination Process: The PFRDA has also modified the e-nomination process for government and private sector employees. Once initiated, the nodal office will have the option to accept or reject the e-nomination request. If the nodal officer does not act on the request within 30 days of its receipt, the e-nomination request is accepted by the central recordkeeping agency.
7] No Credit Card Payment Facility For NPS Tier-2 Account Holders: NPS account holders can no longer contribute to their tier-2 accounts using credit cards. This year, the PRFDA issued an official notification asking all points of presence (PoPs) to stop accepting credit card payments for contributions to NPS tier-2 accounts with immediate effect.
8] Trail Commission Payment Through Points of Presence (PoP): The PFRDA now allows NPS account holders to pay trail commissions through PoPs. However, the pension fund regulator has clarified that the trail commission on NPS contributions made via D-Remit, an electronic system that directly transfers money from the investor’s bank account to the trustee bank so that the investor receives the net asset value (NAV) for his/her NPS investments the same day, would be similar to eNPS (online contribution) by subscribers who were on-boarded by the respective PoPs.
Source:OL
