Good news! Guaranteed pension scheme likely for NPS account holders; details

A guaranteed pension programme is under consideration and may be launched as soon as September 30 under the National Pension Scheme. The Pension Fund Regulatory and Development Authority (PFRDA) has a “Minimum Assured Return Scheme” under development, confirmed Chairperson Supratim Bandyopadhyay. 

The PFRDA Chairperson said that the regulatory body has always been aware of the inflation and depreciation of rupee and provided account holders inflation-protected returns.

"The Minimum Assured Return Scheme is under development. Tentatively, we may start from September 30," he was quoted by PTI. 

"Over a 13-year period, we have given a compounded annual growth of more than 10 per cent... 10.27 per cent to be precise. Always, we have given investors inflation-protected returns," he added.

Pension assets amount to Rs 35 lakh crore. Of this, 22 percent are with NPS to the tune of Rs 7.72 lakh crore. The EPFO holds around 40 percent. Enrolment of subscribers has grown significantly from 3.41 lakh to 9.76 lakh this year. It is projected to grow to 20 lakh in the current fiscal, he added.

The maximum age of joining has been extended to 70 years. Similarly, the age for exit has been pushed to 75 years. At the age of 60 or superannuation age, the NPS account would be "auto continued". Account holders can defer annuity purchase up to the age of 75 years.

Furthermore, subscribers can opt to exit prematurely after 5 years of joining NPS. They can change their investment choice 4 times in a financial year, he added. 

Other initiatives include ease of on-boarding through digital means like Aadhaar, DigiLocker, CKYC for KYC, OTP-based authentications and paperless processes of onboarding and servicing.

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