The maximum age limit for joining National Pension System has been raised from 60 years to 65 years to upturn pension coverage in India
New Delhi: In one more significant move to enlarge pension coverage in the nation, the maximum age limit for joining the National Pension System (NPS) has been upraised from 60 years to 65 years for persons who are not government employees, the finance ministry stated on this Wednesday.
Those eligible candidates include self –employed and corporate employees. The drive by the Pension Fund Regulatory and Development Authority (PFRDA) will allow people aged amid 60 and 65 years to join NPS and mark contributions to it till they turn 70, the ministry said in a declaration.
Till now, individuals amid 18 and 60 years of age would join NPS.
“The subscriber joining NPS yonder the age of 60 years will have the similar choice of the Pension Fund together with the investment choice as is accessible below the NPS for subscribers joining NPS before the age limit of 60 years,” the declaration said.
Rendering to PFRDA, the initiative will let a larger segment of society, predominantly senior citizens, to procure the benefits of NPS and plan for a regular income.
The pension rates accessible at an older age offer better returns than that at the age of 60 years or less, it stated.
NPS is a voluntary causative retirement savings scheme intended to enable systematic savings through a subscriber’s working life. It is an effort at providing a sufficient retirement income to every single citizen of India.
“Subscriber joining NPS after the stage of 60 years will have a choice of the normal exodus from NPS after finishing off 3 years in NPS. In this instance, the subscriber will be vital to utilize minimum 40% of the corpus for the purchase of pension and the rest of the amount can be withdrawn in a lump sum,” the declaration said. If a subscriber wishes to departure from NPS before the end of three years, he/she will be permissible to do so. In such a situation, the subscriber will have to use minimum 80% of the corpus of buying an annuity and withdraw the remaining, it said.
In case of demise of a subscriber, the complete corpus will be paid to the candidate.
NPS was presented in 2004 for government employees and opened to each citizen in 2009. It currently has a corpus of Rs 2 trillion with a subscriber vile of over 16 million people. The subscriber base embraces central and state government employees and people from the private sector, counting the informal economy. The Atal Pension Yojana, a scheme hurled in 2015 for the unorganized sector, is a part of the subscriber vile with around 5.8 million beneficiaries accounting for a body of about Rs2,500 crore.