How to withdraw money from NPS: PFRDA has implemented new provisions for withdrawal of pension under the National Pension System. The new rules will be effective from February 1, 2024. Subscribers can make partial withdrawals only three times during the entire tenure of their subscription.
NPS new withdrawal rules: Pension Fund Regulatory and Development Authority (PFRDA) has implemented new provisions for withdrawal of pension under the National Pension System (NPS). These provisions will be effective from February 1, 2024. The pension regulator had issued a master circular on January 12, 2024, in which new rules for partial withdrawals have been stated. As per rules, NPS subscribers cannot withdraw more than 25% of the contribution deposited in their individual pension account. Subscribers can make partial withdrawals only three times during the entire tenure of their subscription. Partial withdrawals are eligible if the subscriber has been a member of the scheme for at least three years. Partial withdrawal from NPS is allowed in situations like children’s education, marriage, construction of a house or medical emergency.
As per the new rules, customers can apply for partial withdrawal under the following circumstances:
- To meet the higher education expenses of the subscriber’s children. This also applies to legally adopted children.
- To meet the marriage expenses of the subscribers’ children. Also applies to legally adopted children.
- In case of purchasing or constructing a house or flat in the name of the subscriber or jointly owned.
- To cover the treatment expenses for cancer, kidney failure, multiple sclerosis, major organ transplant, coronary artery bypass graft and other such diseases.
- Medical and incidental expenses incurred due to disability or incapacity.
- Expenditures for skill development or re-skilling.
- For the customer to set up his own venture or any start-up.
Other rules for partial withdrawal:
- The subscriber must have completed a minimum of three years of membership from the date of joining NPS.
- Partial withdrawal amount should not exceed one fourth (25%) of the customer’s total contribution.
- For subsequent partial withdrawals, only incremental contributions made by the subscriber from the date of previous partial withdrawal will be allowed.
How to apply for withdrawal?
Subscribers must submit their withdrawal requests to the Central Recordkeeping Agency (CRA) through the respective government nodal office or presence centre. The request should contain a self-declaration explaining the purpose of the withdrawal. If the subscriber is unwell, a family member can also apply for withdrawal.
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