Planning to subscribe for NPS? Here are five new rule changes

New Delhi, Sep 24: Under the voluntary pension scheme the National Pension Scheme (NPS), investors can go for both debt and equity exposure through a single investment tool.

At the time of retirement under the NPS the investor can choose up to 75 per cent equity exposure and withdraw up to 60 per cent of the maturity amount. The remaining 40 per cent will be used to buy annuity and will be used as a monthly pension that would be payable to the NPS account holders.

Recently five rules were updated by by the ension Fund Regulatory Development Authority (PFRDA) and Insurance Regulatory and Development Authority of India (IRDAI). Here is what you should know.

E-nomination flow: Starting October 1, the nodal office can accept or reject e-nomination requests of an account holder. The request would be automatically accepted in the Central Recordkeeping Agencies system in case the nodal office does not initiate any action on the request within 30 days of allotment.

Trail commission payments through PoP: This rule is no longer effective starting September 1. Under this the trail commission to Points of Presence (PoP) for D-Remit contributions of the associated subscribes shall be 20 per cent of the contribution amount. In case of eNPS, the contribution amount is between Rs 15 and Rs 15,000, including the lower and upper limits.

Buy annuity with same form: At the time of maturity, no separate form is required by annuity and instead exit from NPS will be considered as proposal to buy annuities from life insurance companies. This step has been taken up by IRDAI to make the onboarding process easier for new subscribers to this voluntary retirement scheme.

No credit card payment for tier-2 account holders: The PFRDA has stopped the use of credit cards to pay for subscribers of NPS contribution in tier-2 accounts.

Submit life certificate digitally: The IRDAI in a bid to ease the process of submission has directed insurance firms to use Aadhaar-based authentication.