Introduction
With effect from 2004, the central government has introduced the National Pension Scheme. As of now, this scheme is available for all Indian citizens, except the armed forces.
The NSDL is appointed as the Central Recordkeeping Agency (CRA) by the Pension fund Regulatory and Development Authority (PFRDA).
CRA entrusts with the services of record-keeping, administration, and customer services. The NSDL keeps a very detailed individual record of all investments and withdrawals done by the individuals.
Most of the records get maintained in the electronic format; hence access becomes quick and easy.
The CRA issues the Permanent Retirement Account Number (PRAN) to each pension scheme account holder and maintains the account of individuals under the scheme. This PRAN number is sufficient for the investor to enter into any transaction or get any information about his account and holdings.
For the ease of account holder NSDL has launched the NPS mobile app. It became possible because the record is available in the electronic format.
NPS Mobile App
The NPS mobile app is very user friendly, and the subscribers can quickly login to the app using their PRAN and password. The interface is very user friendly, and navigation to different features of the app is simple.
The user can quickly check his account details and, if required, can also edit his personal information.
Features of NPS Mobile App:
- The user can very quickly get to see his account details and also check the holdings that he has.
- Through this app, the transaction details requested in the email.
- In the case of Tier I / and Tier II, the contributions can be submitted through the app.
- When the user wishes, they can change the scheme preference through this app.
- Withdrawals can initiate from the tier II account through the app.
- One can view his complete account.
- If needed, the app also provides the facility of downloading the e-pran.
- The app also performs the function of grievance redressal.
- It has the facility to view the last five transaction contributions.
- Personal details like email id, telephone number, etc. can be changed through the app.
- If needed, the password and the secret question gets reset through the app.
- Facility to get notifications regards NPS
NPS Mobile App Pros and Cons
NPS is a massive initiative by the government to provide some steady income post-retirement. Any project of that size and coverage will have some advantages and some disadvantages too.
One must carefully evaluate the pros and cons and decide how it matches their investment and retirement objectives.
Pros
- Able and knowledgeable professionals manage the corpus fund.
- It is possible to get invested in NPS with a minimal amount. Tier I accounts can be opened with just Rs 500/-
- The documentation is very minimal and straightforward.
- NPS is the cheapest pension plan in the whole world.
- They do have a separate back office app.
Cons
- There is a limit on withdrawals at one time
- The benefits are a little less than what is provided by other private players.
- Though it is a government scheme, returns are not guaranteed.
Conclusion:
The NPS is an excellent initiative by the Govt of India. Till 2009 only Government employees could take advantage of the scheme.
But post-2009, employees of a private organization, freelancers any Indian can participate in the National pension scheme.
An effort made to keep the working of the scheme transparent is commendable. The information sharing with the users has increased substantially, particularly after the launch of the app.
Of all the existing schemes, the NPS gives a fair balance of return, investment, and risk.
A good portion of the corpus gets invested in the equity market, under the able guidance of fund managers, and hence the return is higher as compared to other government schemes.
However, it is advisable to check all other comparative schemes before investing in NPS. The expectation of return, ability to invest, and the risk appetite differs from one individual to another.
Hence, the suitability of the scheme should be checked before being a part of the National Pension Scheme.
NPS Mobile App FAQs
Q. Who can join NPS?
A. Anyone individual who is a citizen of India and is between the age of 18 – 65 years can join the NPS. Earlier, this scheme was especially for government employees, but now anyone can join it.
Q. How many accounts can an individual open in NPS?
A. One individual can open only one account in the NPS. He will be issued a unique PRAN number. One person can have only one PRAN. Portability facility is available if one moves to a different place, but only one account per person is allowed.
Q. How does the withdrawal work in NPS?
A. The NPS has restricted withdrawal limits. It is not at all liberal with withdrawals. The first withdrawal gets effected only after completion of l0 years in NPS. And only a total of three withdrawals can be done until the person reaches the age of sixty years. The total amount of withdrawals in the above case, cannot exceed the total ‘contribution’ made by the member.
Q. Can anyone open a joint NPS account with wife, children, or relatives?
A. No. Joint accounts in the NPS is not possible. It has provisions only for individual accounts. It is a personal pension scheme, the necessity of a joint account not considered by the organizers and administrators of the program.
Q. Are the returns from NPS tax-free?
A. NPS does not have a blanket policy on taxes. No, the returns from NPS are not tax-free, but not all returns charged. Up to 40% of the returns from NPS are tax-exempt, the balance 60 % gets taxed.
