Faq National Pension System

1. What is National Pension System (NPS)?
NPS is an easily accessible, low cost, tax-efficient, flexible and portable defined
contribution voluntary retirement savings scheme introduced by the Government of India,
and regulated by Pension Fund Regulatory and Development Authority (PFRDA).
2. What are the key features of NPS?
1. Regulated - NPS is regulated by PFRDA, which is established through an Act of

Parliament. (PFRDA Act 2013)
2. Pension for All - can be voluntarily subscribed by any Indian Citizen (resident/non-
resident/ overseas citizen).
3. Low Cost – NPS is one of the lowest cost pension schemes in the world.
4. Flexible - Subscribers have choices of Point of Presence (PoP), Central
Recordkeeping Agency (CRA), Pension Fund and Asset Allocation. The choices
exercised can be changed subsequently.
5. Portable – NPS account can be transferred across employment,
location/geography.
6. Tax efficient – Tax incentives are available to subscribers under the Income Tax
Act 1961.
7. Optimum returns – Market linked returns based on investment choice made by the
subscriber.
8. Transparent – Subscribers can access their NPS accounts online 24X7 and public
disclosures mandated.
3. What is the eligibility criteria for NPS?
 Any Indian Citizen (resident or non-resident) and Overseas Citizen of India (OCI)
 Aged between 18-70 years
 Compliant to Know Your Customer (KYC) norms.
Hindu Undivided Families (HUFs) and Persons of Indian Origin (PIOs) are not eligible for
subscribing to NPS.
NPS is an Individual Pension Account and cannot be opened on behalf of a third person.
The applicant should be legally competent to execute a contract as per the Indian Contract
Act.
4. What is All Citizen model?
Citizens of India who are financially not dependent on any employer like self-employed,
professionals, etc. can open and contribute to his/her Individual Pension Account during
the working life for creating a pension corpus from which regular income will be generated
after retirement / working age.
5. What is corporate model?
This model is applicable for the employees working with corporate organisations. Under
this model, employee as well as employer (on behalf of employee) both can contribute
towards NPS account of employee.
6. What is difference between Tier I and Tier II account?
Under NPS account, two sub-accounts- Tier I & II are provided. Tier I account is mandatory
and the subscriber has the choice to opt for Tier II account.
7. How can I open an NPS account online?
NPS account can be opened in just 3 simple steps with ICICI Bank by login to your ICICI Bank
Internet banking or iMobile Application > Investment and Insurance > National Pension
System(NPS)
Step 1: Fill all the Required details (Investment, Personal, Nominee details)
Step 2: Upload Photo and Signature
Step 3: Confirm all your details and Submit.
A Service request number and Permanent Retirement Account Number (PRAN) will be
generated for processing (please save this number for future reference). The SR will be
processed and your account will be activated in 1 working day and it will be communicated
to you through SMS on your registered mobile number.
*Initial minimum contribution amount along with the Subscription application is Rs.500/-
8. What are the tax benefits in NPS?
 NPS Contributions are eligible for tax deduction u/s 80 CCD (1) of Income Tax Act
upto 10% of basic + DA or upto 20% of Gross Income for self-employed within the
overall ceiling of ₹1.50 Lacs under Sec. 80 CCE.
 An additional deduction upto ₹50,000/- is available u/s 80CCD 1(B) of Income Tax
Act.
 In case the subscriber receives contributions from the employer also, tax deduction
under section 80 CCD (2) of Income Tax Act may be claimed by the subscriber in
addition to the tax benefits available under Sec. 80 CCE, subject to an aggregate
limit of ₹7.5 lakh of contributions made towards NPS, Recognized Provident Fund
and Approved Superannuation Fund.
9. What are the different Fund Management Schemes available to the subscriber?
The NPS offers two approaches to invest subscriber’s money:

a) Active choice – Here the individual would decide on the asset classes in which the
contributed funds are to be invested and their percentages (Asset class E(maximum of
75%), Asset Class C, Asset Class G and Asset Class A(Maximum of 5%))
b) Auto choice - This is the default option under NPS and wherein the management of
investment of funds is done automatically based on the age profile of the subscriber.
10. How can I contribute to National Pension System (NPS) for the year online?
 Login to www.icicibank.com
 Click on Payments & Transfer > Pay bills > Pension > National Pension System
 Register Biller by providing required details i.e. PRAN, DOB, Amount, Payment type
(Onetime/Recurring), etc. as available in ICICI Bank records.
 Preview the details filled and click on “Submit” to register the biller and fund the
NPS account successfully.
Once the biller is registered, you can directly contribute to your NPS account through
registered biller anytime.
Please Note:
 First contribution towards National Pension System (NPS) needs to be made
online within 45 days of PRAN generation or the account will be frozen
 It will take 3 working days to reflect the amount in NPS account; hence do not
make another payment before 3 working days or the same will be reversed to
your savings account.
11. What is the minimum and maximum amount for NPS?
Minimum Contributions (For Tier-I)

• Minimum contribution at the time of account opening and for all subsequent
transactions – Rs.500/-
• Minimum contribution per year – Rs.1,000/- excluding any charges and taxes
• If the subscriber contributes less than Rs.1000/- in a year, his/her account would be
frozen and further transactions will be allowed only after the account is reactivated
• In order to reactivate the account, the subscriber would have to pay the minimum
contributions.
Minimum Contributions (For Tier-II)
• Minimum contribution at the time of account opening – Rs.100/- and for all subsequent
transactions a minimum amount per contribution of Rs. 250/- Non-compliance of
mandatory minimum contributions:
• Under NPS, the manner in which your money is invested will depend upon subscriber’s
own choice. NPS offers a number of funds and multiple investment options to choose
from. In case subscriber does not want to exercise a choice, his/her money will be
invested as per the "Auto Choice" option, where money will be invested in various type
of schemes as per subscriber’s age.
12. Where can I view my contribution towards NPS?
ICICI Bank provided NPS portfolio service where you can view following details:
1. Total Amount Invested till date
2. Total Holdings
3. Notional Gain/Loss
4. XIRR & FY-XIRR
5. PFM & Scheme details
6. Asset Allocation
7. Last Five Transection
8. Download any financial Year statement of transection
13. Can we have a joint account for the National Pension System ?
No
14. When can I Withdraw my money from NPS account?
A subscriber can withdraw from NPS in the following circumstances/conditions:

1. Normal Withdrawal – on completion of 60 years of age (if subscriber has joined NPS
before 60 years of age) or after completion of 03 years (if subscriber has joined NPS after
60 years of age), subscriber can withdraw maximum 60% of the corpus as lumpsum and
minimum 40% of the corpus has to be utilized for purchasing an annuity plan for receiving
the pension. If the accumulated corpus is less than ₹5 lakhs, the entire corpus is paid as
lumpsum to the subscriber.
2. Partial Withdrawal - after completion of 3 years subscriber can withdraw 25% of his/her
own contributions for specific reasons viz illness, disability, education or marriage of
children, purchasing property, starting a new venture. A subscriber can partially withdraw
upto a maximum of 3 times during his/her entire tenure in NPS.
3. Premature Withdrawal - after completion of 5 years or before completion of 03 years (if
subscriber joined NPS after attaining 60 years of age), subscriber can withdraw maximum
20% of the corpus as lumpsum and minimum 80% of the corpus has to be utilized for
purchasing an annuity plan for receiving the pension. If the accumulated corpus is less
than ₹2.5 lakh, the entire corpus is paid as lumpsum to the subscriber.
15. What if I don’t want to exit from NPS at 60 years of age?
If an NPS All Citizen subscriber does not exit from NPS at 60 years of age, the account will
automatically be continued up to 75 years of age. Subscriber can exercise the option of
normal exit from NPS at any point of time he/she wishes after 60 years of age. At the age
of 75 years, the account has to be closed mandatorily.
Invest in NPS today and contribute regularly to get attractive returns and tax
benefits for better tomorrow!

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1. What is National Pension System (NPS)?

2. What are the key features of NPS?

1. Regulated - NPS is regulated by PFRDA, which is established through an Act of

3. What is the eligibility criteria for NPS?

4. What is All Citizen model?

6. What is difference between Tier I and Tier II account?

7. How can I open an NPS account online?

The NPS offers two approaches to invest subscriber’s money:

11. What is the minimum and maximum amount for NPS?

Minimum Contributions (For Tier-I)

12. Where can I view my contribution towards NPS?

14. When can I Withdraw my money from NPS account?

A subscriber can withdraw from NPS in the following circumstances/conditions:

15. What if I don’t want to exit from NPS at 60 years of age?

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