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NPS Swavalamban

Fresh registration under Swavalamban Scheme has been discontinued w.e.f April 1, 2015. The subscribers of Swavalamban/ NPS Lite who are in the age group of 18-40 years have been given option to migrate to new Atal Pension Yojana (APY) launched by the Govt. of India in May 2015 which provide minimum guaranteed pension and is focused towards the poor and the under-privileged citizen of India. NPS Lite/ Swavalamban subscribers who are above 40 years of age and thus cannot migrate to APY can continue in the Swavalamban scheme till they attain the age of 60 years. If they wish, they can also exit from the scheme.

Eligibility

The scheme is applicable for all citizens of India (age group of 18-60 years) in the unorganized sector, person will be deemed to belong to the unorganised sector if that person is not in regular employment of the Central or a state government, or an autonomous body/ public sector undertaking of the Central or state government having employer assisted retirement benefit scheme, are not covered by a social security scheme under any of the following laws:

  • Employees' Provident Fund and Miscellaneous Provisions Act,1952
  • The Coal Mines Provident Fund and Miscellaneous Provisions Act,1948
  • The Seamen's Provident Fund Act, 1966
  • The Assam Tea Plantations Provident Fund and Pension Fund Scheme Act 1955
  • The Jammu and Kashmir Employees' Provident Fund Act, 1961

The scheme is applicable to all persons in the unorganised sector subject to the condition that the benefit of Central Government contribution will be available only to those persons whose contribution to NPS is minimum Rs.1,000 and maximum Rs. 12,000 per annum, for both Tier I and II taken together, provided that the person makes a minimum contribution of Rs. 1000 per annum to his Tier I NPS account.

Enrollment

  • Eligible* individuals in the age group of 18-60 years, willing to open an NPS-Swavalamban account may fill a NPS-Swavalamban form.  (Link for Form)
  • Acceptable Documents for KYC
  • Initial minimum contribution amount to be deposited at the time of registration is Rs.100/- only.
  • Submit your filled form along with the relevant documents to an Aggregator.
  • To search your nearest Aggregator

Or

  • Individual may also call to Toll free call center number 1800-110-708 or SMS “NPS” to 56677 (Charges Applicable).

Contribution

  • NPS Swavalamban, being aimed at economically disadvantaged sections of the society, shall have minimum and maximum limits of investment amount in each account prescribed by PFRDA and as amended from time to time.
  • The maximum investment limit prescribed by RBI vide their master circular number RBI/2008-09/72 dated 1st July 2001 for “ Small Deposit Accounts” shall be applicable for each NPS account opened under NPS Swavalamban, till PFRDA prescribes separate limits.
  • To become eligible for Swavalamban benefit a subscriber needs to contribute within the specified limit of Rs. 1000-12000 per year in his NPS account.
  • The subscriber will not be eligible for Swavalamban benefit of Rs. 1000/- where self contribution is not in between specified limit.

Investment Choices

An investment class can be specified by PFRDA. The investment choice shall remain uniform across all subscribers under one particular aggregator.

PFRDA shall specify, from time to time, the Pension Fund Manager(s) who may be assigned the responsibility of managing the funds under NPS Swavalamban.

PFRDA may, at its discretion and in the interest of subscribers, specify a pre-defined set of asset classes for investments from which aggregators may choose one or leave it open to the aggregators to devise their own mix.

For the present, scheme with the investment pattern similar to that prescribed by the Central government for its own employees, as amended from time to time shall be available for NPS Swavalamban.

The Aggregator on behalf of their underlying subscribers may choose one of the Single PFMs to whom the entire corpus can be invested. The Single PFMs are:

  • ICICI Prudential Pension Funds Management Company Limited
  • DSP Black Rock Pension Fund Managers Pvt. Limited
  • Kotak Mahindra Pension Fund Limited
  • Reliance Capital Pension Fund Limited
  • HDFC Pension Management Company Limited
  • SBI Pension Funds Pvt. Limited
  • UTI Retirement Solutions Limited
  • LIC Pension Fund Limited
  • LIC Pension Fund Limited
  • SBI Pension Funds Private Limited
  • UTI Retirement Solutions Limited

The aggregators may also choose to invest the contributions through all the three PFMs as per Central Govt. Scheme in the same manner as for government employees. The allocation ratio of this scheme is reviewed by PFRDA on a periodic basis. In this scheme the allocation is made across following Fund Managers:

  • LIC Pension Fund Limited
  • SBI Pension Funds Private Limited
  • UTI Retirement Solutions Limited

Withdrawal/Exit

The exit from the Swavalamban Scheme would be on the same terms and conditions on which exit from Tier-I account of NPS is permitted, that is, exit at age 60 with 40% minimum annuitisation of pension wealth and exit before age 60 with 80% minimum annuitisation of pension wealth. However, the exit would be subject to the overriding condition that the amount of pension wealth to be annuitised should be sufficient to yield a minimum amount of Rs. 1,000 per month. If the annuitized pension wealth does not yield an amount of Rs. 1,000 per month, the percentage of pension wealth to be annuitised would be increased so that the pension amount becomes Rs. 1,000 per month, failing which the entire pension wealth would be subject to annuitisation. This minimum pension ceiling may be revised from time to time.

Vesting CriteriaBenefit
At any point in time before 60 years of Age*You would be required to invest at least 80% of the pension wealth to purchase a life annuity from any IRDA – regulated life insurance company. Rest 20% of the pension wealth may be withdrawn as lump sum.
On attaining the Age of 60 years.*At exit you would be required to invest minimum 40% of your accumulated savings (pension wealth) to purchase a life annuity from any IRDA-regulated life insurance company empanelled with PFRDA. You may choose to purchase an annuity for an amount greater than 40 percent. The remaining pension wealth can either be withdrawn in a lump sum on attaining the age of 60.
Death due to any causeIn such an unfortunate event, option will be available to the nominee to receive 100% of the NPS pension wealth in lump sum. However, if the nominee wishes to continue with the NPS, he/she shall have to subscribe to NPS individually after following due KYC procedure.

*However, the exit would be subject to the overriding condition that the amount of pension wealth to be annuitised should be sufficient to yield a minimum amount of Rs. 1,000 per month. If the annuitized pension wealth does not yield an amount of Rs. 1,000 per month, the percentage of pension wealth to be annuitised would be increased so that the pension amount becomes Rs. 1,000 per month, failing which the entire pension wealth would be subject to annuitisation. This minimum pension ceiling may be revised from time to time.

Charges

Various charges and their mode of realization are attached below and are subject to revision by PFRDA from time to time.

IntermediaryCharge headService chargesMethod of Deduction
CRAAccount Opening ChargesRs. 35/- (Digitization will be carried out by CRA-FC)Through cancellation of units
Annaul PRA Maintenance cost per accountRs. 35/- per annum,with 12 free subscriber contributions per financial year.
Charge per transactionNil for first 12 transactions beyond 12 free subscriber contribution in each year.
Custodian(On assest values in custody)Asset Servicing charges0.0075% p.a for electronic segment & 0.05% p.a. for Physical Segment(These charges are loaded on NAv,hence would be borne by individual subscriber)Through NAV deduction
PFM chargesInvestment Management Fee0.0102% p.a.Through NA

Source: Pension Fund Regulatory and Development Authority

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