PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY
09 August 2016
All Stakeholders in the National Pension System
Subject: (i) Reducing the Minimum Contribution Requirement of Rs. 6000/- per annum under NPS Private Sector- Tier I (All Citizen Model and Corporate Model) to Rs. 1000/- per financial year
(ii) Waiver of minimum requirement of contribution of Rs. 250/- per annum and maintenance of balance of Rs. 2000/- at the end of Financial Year under NPS-Tier II account
(iii) Unfreezing all the existing frozen accounts due to non-contribution of minimum contribution of Rs. 6000/- per annum in Tier I account and minimum contribution of Rs. 250/- per annum in Tier II account and the minimum balance requirement of Rs. 2000/- at the end of the financial year in the Tier II account in
the CRA system as a one-time measure.
1. As per the previous guidelines, the required minimum contribution per financial year for keeping the NPS Tier I account in active status was Rs. 6000/-. If any subscriber did not contribute Rs. 6000/- during a financial year, the account used to get frozen and the subscriber was not able to make any further contribution nor was able to view his account online or make any request for making any changes in the personal details before unfreezing the account.
2. Similarly for NPS Tier II account, the minimum contribution required per financial year for keeping the account active was Rs. 250/- and the balance at the end of the financial year in the Tier II account was required to be Rs. 2000/- .
3. With a view to encourage the access of NPS to all segments of the society including the unorganized sector, it has been decided to reduce the requirement of minimum contribution to keep the NPS Tier I account active, from Rs. 6000/- to Rs. 1000/- per financial year.
4. Similarly keeping in view that NPS Tier II account is a savings account having features of high liquidity and capacity to earn higher returns, to propagate the Tier II account amongst the NPS subscribers of all sector and to provide an easy and hassle free operation of this account , the requirement of maintaining minimum balance of Rs. 2000/- at the end of the financial year and contribution of at least Rs. 250/- per financial year in the Tier II account is now waived off.
5. As a one-time measure all accounts under Tier I and Tier II , frozen in past due to non-contribution of minimum contribution of Rs. 6000/- per annum in Tier I account and minimum contribution of Rs. 250/- per annum in Tier II account and the minimum balance requirement of Rs. 2000/- at the end of the financial year in the Tier II account in the CRA system is being unfrozen. All these subscribers can now make contribution to their NPS account in a normal way without the necessity of using UOS-S10 A form.
6. Even though, the minimum balance requirement for keeping the account active has been reduced, the subscribers are advised to contribute to their Pension Account (PRANs) as much as possible so as to get a decent pension and live dignified life post retirement. It may be mentioned that the benefits or Pension under NPS is based on the contributions made, the vesting period and returns generated thereon.
This is being issued in the interest of the-subscribers under National Pension system.
Deputy General Manager