NPS subscribers

Major Changes in National Pension System (NPS): Choice of Pension Funds and Investment Pattern

“The subscribers may exercise one of the above choices of Investment Pattern twice in a financial year”

Introduction of choice of Pension Funds and Investment Pattern inTier-I of NPS for Central Government subscribers

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY
B-14/A, Chhatrapati Shivaji Bhawan,
Qutab Institutional Area,
Katwaria Sarai, New Delhi-110016.

Ph: 011-26517501, 26517503, 26133730
Fax: 011-26517507
Website: www.pfrda.org.in
PFRDA/2019/8/SUP-PF/1

Date: 8th May, 2019

CIRCULAR

Subject: Introduction of choice of Pension Funds and Investment Pattern in Tier-I of NPS for Central Government subscribers – reg.

Reference is invited to the Gazette Notification F.No.1/3/2016-PR dated 31st January, 2019 issued by Ministry of Finance, Department of Financial Services, modifying Ministry of Finance’s Notification No. 5/7/2003-ECB dated 22nd December, 2003, based on the Government’s decision on the recommendations of a Committee set up to suggest measures for streamlining the implementation of National Pension System (NPS).

2. Accordingly, it has been decided to introduce the following options for Central Government subscribers:

(i) Choice of Pension Fund: As in the case of subscribers in the private sector, the Government subscribers shall also be allowed to choose any one of the pension funds including Private sector pension funds They could change their option once in a year.

However. the current provision of combination of the Public-Sector Pension Funds will be available as the default Option for both existing as well as new Government subscribers.

(ii) Choice of Investment pattern: The following options for investment choices shall be offered to Government employees:

(a) The existing scheme in which funds are allocated by the PFRDA among the three Public Sector Undertaking fund managers based on their past performance in accordance with the guidelines of PFRDA for Government employees shall continue as default scheme for both existing and new subscribers.

(b) Government employees who prefer a fixed return with minimum amount of risk shall be given an option to invest 100% of the funds in Government securities (Scheme G),

(c) Government employees who prefer higher returns shall be given the options of the following two Life Cycle based schemes:

(A) Conservative Life Cycle Fund with maximum exposure to equity capped
at 25% – LC-25.

(B) Moderate Life Cycle Fund with maximum exposure to equity capped at
50% – LC-50.

The subscribers may exercise one of the above choices of Investment Pattern twice in a financial year.

(iii) Implementation of choices to the legacy corpus: Transfer of a huge legacy corpus of more than Re 1 lakh crore in respect of the Government sector subscribers from the existing Pension Fund Managers is likely to impact the market.

It may be practically difficult for the PFRDA to allow Government subscribers to change the Pension Funds or investment pattern in respect of the accumulated corpus, in one go.

Therefore, for the present, change in the Pension Funds or investment pattern is allowed in respect of incremental flows only.

(iv) Transfer of legacy corpus in a reasonable time frame: PFRDA shall draw up a scheme in due course for transfer of accumulated corpus as per new choices of Government subscribers in a reasonable time frame of say five years. Once PFRDA draws up this scheme, change in the Pension Funds or investment pattern shall be allowed in respect of the accumulated corpus in accordance with that scheme.

3. For investment option as per para 2 (ii) (a) above, all other terms and conditions as contained in the investment guidelines issued by the Authority dated 03_03.2015 for NPS Schemes (Applicable to Scheme CG, Scheme SC, Corporate CG and NPS Lite Schemes and APY) and subsequent amendments made thereto shall be applicable.

Further, for investment options as per para 2 (ii) (b) or 2 (ii) (c) (A) or 2 (ii) (c) (B) above, all other terms and conditions as contained in the investment guidelines issued by the Authority dated 04.05.2017 in respect of NPS schemes {Other than Govt. Sector (CG & SG), Corporate CGI NPS Lite and AP Y} and subsequent amendments made thereto shall apply.

4. This circular is issued in exercise of powers of the Authority under sub-clause (b) of sub-section (2) of Section 14 read wtth Section 23 of the PFRDA Act, 2013 and sub- regulation (1) of Regulation 14 of the PFRDA (Pension Fund) Regulations, 2015.

The above arrangements ere applicable w.e.f. 1st April, 2019.

sd/-
(A G. Das)
Executive Director

Voluntary Contribution in Tier I account by Govt. Sector Subscribers

In order to avail Tax benefits under NPS, the Government Subscribers can make an additional investment in their NPS Tier I account. An additional deduction for investment up to Rs. 50,000 in NPS (Tier I account) is available exclusively to NPS subscribers. This additional investment can be made by the Subscribers by either of the following ways:

A. Through associated Nodal Office
B. Through eNPS portal
C. Through NPS Mobile App
D. By logging into the CRA System
E. Through Point of Presence (PoP)

A. Voluntary Contribution through associated Nodal Office {Pay and Accounts Office (PAO)/ Cheque Drawing and Disbursement Offices (CDDOs)}
Govt. Subscribers may approach their associated Nodal Offices (PAOs/ CDDOs) for processing of Voluntary Contributions in their Tier I account. The Nodal Office is required to carry out the following activities:

Download necessary utilities for preparation of contribution file i.e. File Preparation Utility (FPU) and File Validation Utility (FVU). Kindly note, these are separate utilities through which only Tier-II and Tier I Voluntary contributions can be prepared and validated.

The utilities are available on CRA website – www.npscra.nsdl.co.in at the following link:
https://npscra.nsdl.co.in/download/FPU_and_FVU_For_upload_of_Voluntary_and_Tier_II_contribution.zip

Prepare voluntary contribution details by using the FPU. Ensure that contribution type is selected as “Voluntary Contribution”.

Validate voluntary contribution file prepared using the FVU.

Upload Subscriber Contribution File (SCF) in the NPSCAN application (www.npscancra.com) by logging with the User ID and Internet Password (IPIN) provided by NSDLCRA. The procedure of Contribution upload will be similar to the upload of regular contribution files in NPS.

Nodal Office shall upload the SCF in respect of the Subscribers for whom clear funds are available on daily basis. The Nodal Office is required to remit the funds to the Trustee Bank latest by T+1 day (T being the date of receipt of clear funds) post upload of contribution details in the CRA system.

B. Voluntary Contribution through eNPS portal

The Subscribers can also pay voluntary contributions under Tier I online through eNPS. In order to contribute through eNPS, the Subscribers need to follow the below mentioned steps:

Visit the eNPS portal (https://enps.nsdl.com).

Click on the “Contribution” option.

On the next screen, the Subscriber will have to provide PRAN, Date of Birth, enter Captcha details and click on the “Verify PRAN” option. On clicking the “Verify PRAN” option, system will prompt for a One Time Password (OTP) and the same will be sent on the registered mobile number of the Subscriber. System will display a message to the Subscriber about generation of OTP. The Subscriber will enter the OTP and click on submit OTP option.

After submission of OTP, on the next screen the Subscriber will select the Tier Type as “Tier I” and enter the amount in “Voluntary contribution amount” section, select the “Payment Gateway Option”, tick on the declarations and finally click on “Make Payment” option.

Upon successful processing of the contribution, the units will be credited to
Subscribers’ NPS account and an SMS/ Email alert will be sent to the Subscribers’ registered Mobile Number/ Email ID.

C. Voluntary Contribution through NPS Mobile App

Voluntary contribution in Tier I account can also be made using the NPS Mobile App.

NPS Mobile App can be downloaded from Play store for android phones and Appstore for IOS phones (iPhone).

In NPS Mobile App, Subscriber is required to click on the “Contribution” option available on the Home screen.

On the next screen, Subscriber needs to enter the PRAN, Date of Birth and the Captcha details and click on “Verify PRAN” option.

App will prompt for a One Time Password (OTP) and the same will be sent to the registered mobile number of the Subscriber. App will display a message to the Subscriber about generation of OTP. The Subscriber will enter the OTP and click on submit OTP option.

After submission of OTP, on the next screen the Subscriber will select the Tier Type as “Tier I” and enter the amount, select the “Payment Gateway Option”, tick on the declarations and finally click on “Confirm Payment” option.

Upon successful payment, a receipt will get generated confirming the payment details.

D. Voluntary contribution by logging into the CRA System

One more option for Subscribers to contribute voluntarily in Tier I account is by logging into the CRA System with the User ID (i.e. the PRAN) and the Internet Password (IPIN).

In the CRA system, at the Home page, the Subscriber needs to go to Menu – Contribute Online Sub-menu – Make Online Contribution.

System will re-direct the Subscriber to the eNPS portal.

Further, the Subscriber needs to follow the procedure as explained under Point C above.

E. Voluntary contribution through Point of Presence (PoP)/ Point of PresenceService Providers (PoP-SP)

Subscribers may also approach the PoP/ PoP-SPs for making Voluntary Contribution in their Tier I account.

The list of PoPs/ PoP-SPs is available on CRA website (www.npscra.nsdl.co.in).

Total Existing Subscribers in NPS as on March 2019

Total Existing Subscribers Contributing during the month – NPS

Age Band	Total Existing Subscribers Contributing During The Month (Table A)
–	Male	Female	Transgender	NON IRA	Total
18-21 Years	22,501	7,514	–	–	30,015
22-25 Years	2,80,574	74,554	–	–	3,55,128
26-28 Years	5,91,061	1,52,324	3	–	7,43,388
29-35 Years	17,03,030	4,79,873	9	–	21,82,912
>35 Years	16,94,343	5,48,911	10	–	22,43,264
NON- IRA	–	–	–	15,976	15,976
Total	42,91,509	12,63,176	22	15,976	55,70,683

New Subscribers Contributing During Month (Table B)
Central Govt
Male	Female	Transgender	NON- IRA	Total
462	63	–	–	525
2,569	347	–	–	2,916
2,319	382	–	–	2,701
2,012	393	–	–	2,405
869	260	–	–	1,129
–	–	–	–	–
8,231	1,445	–	–	9,676

New Subscribers Contributing During Month (Table B)
State Govt
Male	Female	Transgender	NON- IRA	Total
2,606	1,459	–	–	4,065
10,164	4,310	–	–	14,474
7,298	3,571	–	–	10,869
11,830	7,079	–	–	18,909
13,001	6,258	–	–	19,259
–	–	–	2	2
44,899	22,677	–	2	12,381

New Subscribers Contributing During Month (Table B)
Non-Govt (Corporate Sector)
Male	Female	Transgender	NON- IRA	Total
85	60	–	–	145
2,313	1,158	–	–	3,471
1,987	629	–	–	2,616
3,374	475	–	–	3,849
4,622	539	2	–	5,163
–	–	–	–	–
12,381	2,861	2	–	15,244

1. PRAN association with respective sectors is as on March 31, 2019

2. Central Govt and State Govt includes Central and State Autonomous Bodies respectively.

3. All types of Contribution credit is considered in the above data.

4. As DOB and Gender of Subscriber is not available for NON IRA PRANs, additional category “NON IRA” is included in the above tables.

5. Table A refers to unique PRANs receiving credit (in the reporting month) for Central/State and Corporate Subscribers, irrespective of type of contribution.

6. Table B refers to unique PRAN receiving first credit (in the reporting month) in respective sectors, irrespective of type of contribution. This data is subset of data in Table A.

7. NPS was launched on 01 Jan’04 and was aimed at individuals newly employed with central and state government, but excluding. ones in the armed forces.

8.“Non-Govt” refers to “Corporate sector employees”.

9. Includes NSDL CRA & KARVY CRA data.

10.Non – Govt PRAN data may not necessarily represent new employment as there may be some persons who were in employment earlier but have opened PRAN now.