NPS - National Pension Scheme Services Across India

The NPS is a financial security instrument launched by the Government for the citizens of India. This voluntary saving scheme has restricted withdrawal options and encourages subscribers to invest towards their retirement fund through systematic savings during their employment. The NPS is regulated by the PFRDA and follows transparent investment norms; offering subscribers stable and reasonable returns on their long-term investments. The NPS account is operable from anywhere in the country and eligible for tax benefits under Section 80C of the Income Tax Act.

The NPS has two account options:
  • Tier-I regular pension account
  • Tier-II savings account
Alankit is a Point of Presence Service Provider (POP-SP) for NPS across India through a network of over 5468 business locations. Alankit provides services that include,
  • Subscriber registration for NPS
  • Know Your Customer (KYC) verification
  • Receipt of subscriber contributions
  • Transmission of subscriber contributions to designated NPS intermediaries
  • Subscriber grievances redressal

Who all should invest in NPS?

NPS is a highly beneficial scheme that allows one to develop a significant fund for the second innings of life by regularly making an investment in this account during one’s period of employment. A regular income invested in the account in one’s active years can be a great way to secure one’s future, particularly for those getting retired from the private sector jobs. Our Government already provides this type of pension facility for the employees working in the public sector but those working in the private corporate sector or any unorganized segment also do not have access to this facility. That’s exactly why a systematic plan of investment such as NPS can be a good choice. Thus, all the salaried class people on the lookout for taking the maximum advantage of 80C deductions may also consider this scheme.

Features & Benefits- NPS

  • Returns/ Interest - A specific part of the amount invested in one’s NPS is duly invested in the market in different equities, which does not offer any guaranteed returns. However, in all probability the returns are usually higher as compared to the conventional tax-saving investments such as the PPF. NPS has been going strong since over a decade now, and till now, it has delivered annual returns of about 8% to 10%. The scheme also offers one the freedom to change their fund manager if required in case the performance of the fund is not coming as per expectations.
  • Contribution of Investor - Despite there being no particular upper limit as such, there is still a fixed requirement of the minimum investment amount. One is required to invest either a minimum monthly amount of Rs. 500 (Tier I account) or Rs. 250 (Tier II account) at least, or an annual amount of Rs. 1,000 (Tier I account). In case one is unable to sustain the minimum specified amount, the account will automatically get will freezed. It can then be unfreezed by giving a penalty at any of the nearest Point of Presence (PoP).
  • Assessment of Risk - As of now, there is a fixed cap of 50% on equity exposure for the national pension scheme. Owing to this, the ratio of risk and return is stabilized in the investor’s interest. Thereafter, the corpus is somehow protected against the instability of the equity market. However, the potential of earning is higher as compared to any other fixed income schemes. The PFRDA has plans to increase this cap on equity exposure to 75% in the coming times.

Frequently Asked Questions About NPS

How can a subscriber contribute to NPS?
How much does a subscriber need to contribute?
What tax benefits can NPS accountholders accrue?
Who can join NPS?
How can an individual exit from NPS before the age of 60?
What is CRA?
What is PRAN?
Can an individual transfer savings from a NPS Tier II to NPS Tier I account or vice versa?
What is Annuity?
How can an individual exit from NPS?
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