NPS withdrawal rules (Ammended)
Pension Fund Regulatory and Development Authority has allowed subscribers to withdraw 100% of contributions in National Pension System (NPS) at retirement age i.e. at age of 60 years if total accumulated pension corpus amount is less than or equal to Rupees Five lakhs.
In case of Subscriber death, Nominee or legal hire can withdraw 100% of contributions in NPS Account if total accumulated pension corpus amount is less than or equal to Rs. 5 lakh without buying annuity.
This changes has been done under the PFRDA Amendment Act published in the Gazette of India.
This will offer more liquidity in the hands of the investors. Also, they could invest the withdrawn money into other investment avenues to earn better returns. This will help NPS penetrate deeper into the Indian society where small investors can take benefit of the scheme.
PFRDA allows NPS subscribers to defer annuity for three years, it means that subscriber has option to defer payment of annuity for three years at retirement age of 65.
Additionally, PFRDA has increased the maximum age of entry into the NPS from 65 to 70. The exit age limit has also been extended to 75 years. Also, the premature withdrawal limit on a lumpsum basis for NPS has been increased to Rs 2.5 lakh from Rs 1 lakh.
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