NPS Scheme: There is good news for those investing in the government’s pension scheme National Pension System (NPS).
The Pension Fund Regulatory and Development Authority (PFRDA) has announced that it will soon allow NPS scheme subscribers to change the investment pattern four times during a financial year. As of now, customers are allowed to change the investment pattern twice in a year under the NPS scheme.
Know what the chairman of PFRDA said?
Last month, PFRDA Chairman Supratim Bandyopadhyay had said, “At present, customers can change their investment option only twice in a year. Soon, we are going to increase this to four. There was a demand to increase the limit in the scheme, That’s why it will be changed.”
He also said, “PFRDA only wants it to remain a long-term investment product to create a pension fund and not to equate it with a mutual fund scheme. People sometimes mix it with some mutual funds which can give good returns. You have to give it some time and after that, only you can use it (change option). Use it judiciously, we are going to increase it.’
Where in the Scheme Investments Under the scheme, subscribers can invest their investments in government securities, debt instruments, asset-backed and trust-structured investments, short-term debt investments and equities and related investments. However, there are different rules for different sets of customers.
For example, government sector employees cannot invest much in equities while corporate sector employees are allowed to allocate up to 75% of the assets to equities. Apart from this, the subscribers are also allowed to change the fund manager once in a year. Fund managers invest the pension assets of the customers in prescribed investment schemes as per their choice.
