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NPS partial withdrawal rule modified for government-sector employees; details here
The NPS partial withdrawal option through self-declaration will still be available to voluntary non-government NPS subscribers, according to PFRDA
When the coronavirus pandemic struck the world in 2020, higher authorities in several nations responded quickly to make sure individuals had enough cash on hand for emergency hospitalisation and other COVID-related expenses. One of the laws implemented in India allowed National Pension System (NPS) members to make partial online withdrawals through self-declaration. This move marked a huge relief for the NPS subscribers. However, since the pandemic has receded, the Pension Fund Regulatory and Development Authority (PFRDA) has decided not to continue with the measure.The earlier rule mandated that NPS members were exempted from providing documentation to support their requests for partial withdrawal. Now, the online partial withdrawal option from NPS through self-declaration has been changed for subscribers working in the government sector. This feature will no longer be available from 1 January 2023, according to the pension authority. As per the new order, all subscribers from any government entity like Centre, State, and Central Autonomous Bodies are now eligible to apply for NPS Partial Withdrawal, but they must submit their form only to the nodal officer.Notably, the partial withdrawal option through self-declaration will still be available to voluntary non-government NPS subscribers, according to PFRDA. In order for subscribers to be allowed to make partial withdrawals, they are required to fulfill a few certain criteria. Customers should meet the following prerequisites to submit their request for partial withdrawal from NPS accounts, as revealed by Protean, an online repository operated by eGov Technologies Ltd:
- The subscriber must be associated with the NPS scheme for at least three years.
- The subscriber’s withdrawal request cannot be for more than 25 percent of his total contributions.
- They are permitted to use this partial-withdrawal feature only for a maximum of three times during the term of the NPS subscription.
- The customer must give a specific and valid justification for the reason behind the partial withdrawal. These can include the treatment of serious diseases, the higher education of children, the marriage of children or the purchase or construction of a residential home, among others.
First Published:Dec 27, 2022, 12:09:36 IST
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