An NPS or New Pension Scheme account is a social security account initiated by the Government of India that provides a regular stream of income to individuals after retirement. The account provides a steady income to the account holder through market-linked returns and is available to all Indian citizens.
Initially, opening an NPS account required one to fill out the Permanent Retirement Account Number (PRAN) application form and submit the form and KYC documents to a Point of Presence-Service Provider (POS-SP).
The above process used to be cumbersome, as the prospective account holder would have to visit an authorised bank branch, after which the PRAN number would be generated, all of which takes a lot of time.
In case of online applications, too, the applicant was required to take a printout of the form, affix a recent photograph, sign it and mail it to the Central Recordkeeping Agency (CRA) within 90 days of being issued the PRAN.
To speed up the process and make it easier for individuals to open an NPS account, a circular stating that these accounts could be opened online without needing to visit a branch was released by the PFRDA (Pension Fund Regulatory and Development Authority). According to this circular, individuals who wish to open an NPS account can do so online, and the verification of identity would be through the Aadhaar card and the applicant’s e-signature.
This not only simplifies the process of opening an account but also ensures that the information entered into the database is correct, as the individual would have to verify it before authorising the digital signature.
Process To Open NPS Account Online With Aadhaar based eKYC on eNPS platform
Individuals can open an NPS account both online and offline as per the PFRDA circular. Individuals who wish to open an NPS account online can follow the steps listed below:
- Visit the e-NPS portal to open an NPS account online using Aadhaar.
- You will have to click on “National Pension System" and then on the “Registration" option.
- Select the category of account opening - ‘Individual Subscriber’ or ‘Corporate Subscriber’ category.
- After that select ‘Citizen of India’ or ‘Non-Resident of India (NRI)’ or ‘Overseas Citizen of India (OCI)’.
- Click on ‘Aadhaar Online/Offline KYC’ option and select the ‘Tier types’ for the opening of account.
- Select and provide ‘Aadhaar’ (12-digit) or ‘Virtual ID’ (16-digit) number and click ‘Generate OTP’.
- After submission of OTP, details such as your name, gender, date of birth, address, etc. will be retrieved from Aadhaar records.
- Make an NPS contribution and complete the digital registration process through digital authentication.
How To Open NPS Account Offline
Individuals can also choose to open their NPS account offline by visiting a Point of Presence (PoP) entity. These are banks that have been authorised by the PRFDA to assist and generate PRAN numbers.
Individuals who wish to apply offline can follow the steps listed below:
- Visit an authorised bank branch and fill in the application form.
- Submit the necessary KYC documentation along with the filled-in application form and pay the registration fee.
- Once the application has been processed, the PRAN card will be sent by post to the address mentioned in the form.
As seen above, the procedure for applying for an NPS account has been simplified by making the process online, thereby reducing the amount of paperwork and the time taken to process applications.