National Pension System

What is NPS?

The National Pension System (NPS) is a government-sponsored retirement savings scheme in India, designed to provide financial security during old age. It offers a structured way for individuals to accumulate savings through contributions made during their working years and reap an income during their retirement years.

The scheme is regulated by the Pension Fund Regulatory and Development Authority (PFRDA) and is open to all Indian citizens, including salaried employees and self-employed individuals. NPS provides tax benefits under Section 80CCD of the Income Tax Act, making it an attractive option for long-term retirement planning.

Steps to open an NPS Account

  • You can enrol for an NPS Account online through a paperless process on our website, conveniently from your home or office. The scheme aims to offer Indian citizens a compelling long-term savings option for retirement, ensuring safe and reasonable market-based returns. All Indian citizens aged 18 to 70 years are eligible to open an account.
  • Steps for online account opening:​​​​​​​
  • To enrol in NPS, click the 'Apply Now' option under the National Pension System (NPS).
  • You can select any one CRA between K-Fin Technologies Private Limited or NSDL e-governance Infrastructure LTD to open your account.
  • You will receive an online form that you must fill out with the mandatorily requested information.
  • An Acknowledgement ID for your registration (account opening) will be generated. You can complete the registration (account opening form) within 15 days using the acknowledgement number.
  • Choose one of Methods for KYC verification and complete the process. The methods include:
    1. PAN-based verification: HDFC Bank will verify KYC based on the details in your bank account. Ensure all details mentioned in the form are entered as per your existing HDFC Bank Account.
    1. Offline Aadhaar XML KYC: KYC details will be retrieved from the UIDAI database.
  • You must provide details such as bank details, scheme preferences, nominee information, etc.
  • Upload a photograph, specimen signature, cancelled cheque/bank statement/passbook copy, and PAN copy within the permissible file size.
  • Make a minimum initial contribution of ₹500.
  • You will be redirected to a digital payment platform where you can complete the payment through your HDFC Bank NetBanking account or a payment gateway.
  • Upon successful payment, a 12-digit PRAN will be allotted to you, and a PDF form will be generated based on the provided data.
  • Your PRAN will be communicated to you via registered email and SMS.
  • After completing the registration process, you must complete an online e-sign or OTP-based confirmation to avoid physically submitting the registration form.

About NPS

NPS Ombudsman FAQ

Terms And Conditions

NPS Withdrawal

Frequently Asked Questions

National Pension System (NPS) is a voluntary, defined contribution retirement savings scheme initiated by Government of India. The NPS has been designed to enable systematic savings during the employee's working life. It is an attempt towards finding a sustainable solution to provide adequate retirement income which is low cost, tax-efficient and flexible.

There are 2 models, namely - Corporate NPS model and All Citizen model. Corporate NPS model is applicable for all corporate employees wherein the corporate is registered with the Bank for NPS.

NPS model

Description

Corporate Model

This model is applicable for the employees working with corporate organisations. Under this model, employee as well as employer (on behalf of employee) both can contribute towards NPS account of employee

All Citizen Model

Citizens of India who are financially not dependent on any employer like self-employed category, professionals like doctors, CAs, CS, CMAs, lawyers, architects etc.

Individuals who are employed and contributing to NPS would enjoy tax benefits on their own contributions as well as their employer’s contribution as under:

  • Investment up to 10% of Salary (Basic + Dearness Allowance) routed through the Employer, is deductible from taxable income u/s 80CCD (2) of Income Tax Act, 1961 which is over and above Rs. 1.5 lakhs limit of section 80C under Old Tax Regime.
  • Additionally, investment up to Rs.50,000 is deductible from taxable income u/s 80CCD (1B) of Income Tax Act, 1961 under Old Tax Regime.
  • Employees opting for New Tax regime, can choose up to 14% of Salary (Basic + Dearness Allowance) routed through the Employer, is deductible from taxable income u/s 80CCD (2)
  • Maximum limit of amount that can be claimed tax exempt is Rs. 7.5 lakh of employer contribution towards, NPS, PF and Superannuation all together. (Only available for Corporate NPS accounts).

 

Please note:

  1. Tax deductions u/s 80CCD (1) and 80CCD (1B) shall be available only if the taxpayer opts for old tax regime. Please consult your CA to know more about this.
  2. Tax benefit under Section 80 CCD (2) can be availed in either of the tax regimes

There are 4 types of individual funds in which your money can be invested:

  • Asset Class E- Investment in predominantly equity market instrument
  • Asset Class C-Investment in fixed income instruments other than Government Securities
  • Asset Class G- Investment in Government Securities
  • Alternate Assets Class A – Investment in Real Estate and Infrastructure projects

Based on these, there are 2 investment options available under NPS corporate:

Active choice - In active choice, you have to select a Pension Fund Manager and mention the ratio of funds to be invested among E, C, G and A. You can specify the percentage in which your money is to be invested in these asset classes. However, allocation in equity cannot be more than 75% and Alternate Assets cannot be more than 5%.

Auto choice - There is a lifecycle fund and you need to select a pension fund. Your funds will be invested as per the life cycle fund matrix based on your age.

You will have flexibility to choose one out of ten Pension Fund Managers (PFMs) and the percentage in which the selected PFM will invest the funds.

Yes, you have an option to select Pension Fund (PF) and Investment Option while applying for NPS account.

  • Visit www.hdfcbank.com
  • Under 'Personal' click on 'Invest'
  • Select the last option is ' National Pension System'
  • Click on 'Apply Online'
  • Select the CRA of your Choice (either NSDL or K-Fintech) and click on 'Apply now'
  • Select individual or Corporate subscriber
  • Select weather you wish to open Tier I or Tier I and Tier II both.
  • Mention PAN number and generate acknowledgement number
  • Complete the rest of the details in the NPS form.
  • Upload the required documents.
  • Make initial payment.
  • PRAN will be generated with in 15 to 20 minutes
  • Complete the e-sign/OTP authentication process online.

No, HDFC Bank has a complete digital process for its customers. You will have to upload you latest photograph and signature sample online.

There are certain charges applicable for NPS account opening/ maintenance. The charges are mentioned below:

termediary  Charge head  Service charge (+Taxes)  Method of deduction 
HDFC Bank (POP Charges)  New NPS Account opening  Upto maximum ₹400/- To be collected upfront
Financial Transaction  Upto 0.50% of the contribution,subject to maximum ₹.25000/- 
Non-Financial Transaction  Upto maximum ₹30/- 
Persistency** Charge  Rs. 50 per annum for annual
contribution Rs. 1,000 to Rs. 2,999
Rs. 75 per annum for annual
contribution Rs. 3,000 to Rs. 6,000
Rs. 100 per annum for annual
contribution above Rs. 6,000		 Through Unit Deduction 
CRA    Computer Age Management Services Ltd (CAMS) KFIN Technologies Private Limited  Protean eGov Technologies Ltd (Formerly NSDL e-Governance Infrastructure Limited) Through cancellation of Units 
New NPS Account opening  40 39.36  40 
Annual Account Maintenance  65 57.63  69 
Per transaction cost  3.50 3.36  3.75 
Custodian  Asset Servicing charges  0.000000001770%   per annum for Electronic segment & Physical segment
PFM charges  Slabs of AUM managed by the Pension Fund  Maximum Investment Management Fee (IMF)    Through adjustment in NAV 
Upto 10,000 Cr.  0.09%*   
10,001 – 50,000 Cr.  0.06%   
50,001 – 1,50,000 Cr.  0.05%   
Above 1,50,000 Cr.  0.03%   
*UTI Retirement Solutions Ltd charges a fee of 0.07% under this slab   
The IMF to be charged by the Pension Fund on the slab structure would be on the aggregate AUM of the Pension Fund under all schemes managed by Pension Funds.
 
These rates of IMF shall be reviewed by the Authority in a period of five (5) years from the date of implementation.
NPS Trust  Reimbursement of expenses  0.003% pa

 

 

 

 

**Persistency charges is payable to such POPs to which the subscriber is associated for more than six months in a financial year.

 

*GST and other levies, as applicable, will be levied as per the existing tax law

*KYC verification charges of eNPS application Rs 125 + taxes

*Processing of Exit / Withdrawal Upto 0.125% of Corpus subject to maximum ₹500/-

 

*Other taxes / regulatory levies applicable from time to time

No, multiple NPS accounts for a single individual are not allowed and there is no necessity also as the NPS is fully portable across sectors and locations. If you want to link your NPS account to corporate, to avail the benefits under the Corporate NPS model, you should shift existing NPS account to corporate model.

You may contribute through HDFC Bank website or you may also login to your CRA portal to make contributions. SIP option is also available.

The NPS account matures when a subscriber reaches 60. However, individuals can continue contributing until the age of 75. After maturity, the remaining amount in the NPS account is received as a monthly pension. 

To open an NPS account, an initial contribution of ₹500 for a tier I account and ₹250 for a Tier II account is required. Subsequently, to keep the account active, at least one annual contribution of a minimum of ₹1,000 is necessary for Tier I accounts, while there are no conditions on the minimum amount you can deposit in a Tier II account.

The NPS Tier I and II accounts are open to all Indian citizens, and residents, whereas non-residents, and Overseas Citizens of India (OCIs), can open only Tier 1 accounts. All accountholders should be aged between 18 and 70. Additionally, applicants must comply with KYC norms and submit all required documents. However, Hindu Undivided Families and Persons of Indian Origin are not eligible.