NPS minimum contribution: The National Pension System (NPS) is a voluntary, defined contribution pension scheme that allows individuals to create a retirement corpus by making contributions to their individual Pension Account throughout their working life. The accumulated funds are then used to generate a regular income after retirement or reaching the working age limit.
What is the minimum contribution to keep an NPS account active?
- To keep the NPS Tier I account active, a minimum contribution of Rs 1000 must be made in a financial year. If the minimum contribution is not met, the account will be frozen.
- To unfreeze the account, the customer must pay the total minimum contributions for the frozen period, the minimum contribution for the year of reactivation, and a penalty.
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NPS account will only be closed upon the subscriber’s request (either physical or online) for an exit from NPS, submitted to a service provider (PoP).
When opening an NPS account, the following documents must be submitted to the PoP: a completely filled subscriber registration form, proof of identity, proof of address, and age/date of birth proof.For individuals opening an Individual Pension Account through the eNPS platform, a scanned photograph and signature in *.jpeg/*.jpg format (file size between 4kb-12kb) must be uploaded. However, uploading a scanned photograph is optional for those opening the account using Aadhaar details.
According to an ET report, multiple NPS accounts for a single individual are not permitted, and there is no need for multiple accounts as NPS is fully portable across sectors and locations.
An individual can open an Individual Pension Account under NPS by choosing one of two options, provided they have netbanking facilities enabled with their bank.
Option #1 involves providing Aadhaar details, while Option #2 requires providing PAN details and KYC details as recorded with the bank where the individual maintains their account, and the bank must be empanelled in eNPS.
All subscribers (excluding NPS Lite & Atal Pension Yojana), regardless of whether their PRAN was generated online (eNPS) or physically (PoP), can contribute to their PRAN (Tier I & Tier II) using the eNPS platform through netbanking with empanelled banks or via credit/debit cards.
To initiate a payment towards their PRAN, subscribers must quote the correct PRAN and authenticate it using the OTP received on their registered mobile number.
