Planning to withdraw from NPS account? Check new provisions in place

New Delhi: If you have invested in the National Pension Scheme (NPS), you should be aware of how essential it is to upload withdrawal/KYC documents to enable the simultaneous processing of both exiting the scheme and purchasing annuities.

The idea is to simplify the annuity application process. To ensure that, the pension fund regulator and insurance regulator simplified the process of purchasing annuities by mandating annuity service providers (ASPs) to use the NPS withdrawal form submitted by subscribers while exiting the scheme.

These ASPs are life insurance companies regulated by the IRDAI and have an agreement with the PFRDA to serve NPS subscribers. For this, a common proposal form for exiting NPS and purchasing annuities from the ASPs was introduced to significantly reduce the processing time taken by them. However, subscribers must upload all documents beginning April 1, 2023, to ensure the same.

The documents that NPS subscribers must upload include:

• NPS exit/withdrawal form
• Identity and address proofs as mentioned in the withdrawal form
• Proof of bank account details
• A copy of the Permanent Retirement Account Number (PRAN) card

How do you put in your NPS exit request?

Subscribers may initiate requests online in the CRA system using the following steps

• Log into the CRA system to commence the online request for exit from NPS.
• On initiation of the request, the subscriber receives messages containing details of e-Sign/OTP authentication, authorization of request by the Nodal Office/POP, etc.
• While initiating the request, important details including address, bank account and nominee details are automatically updated from the NPS account.
• The subscriber must then decide how much money to receive in a lump sum while allocating the remaining money to receive in a pension format. However, the annuity details must also be shared for the same.
• The subscriber’s bank account registered in CRA will be checked and validated using online bank account verification.
• Subscribers must upload their KYC documents, copies of their PRAN card/e-PRAN and bank proof details while submitting requests for the exit.
• The subscriber then authorizes the request by using any of the options mentioned on the site to ensure paperless transactions.