PFRDA Suggests National Pension System (NPS) Reforms

1. Exit Rules Liberalized:

• Leaving early on 15-years contribution (as opposed to having to wait until age 60/retirement)
• Maximum age on the continuation of NPS increased to 85 years.

2. Annuity Requirements Eased:

• Compulsory purchase of annuities decreased to 20 % of corpus instead of 40 % of corpus in the case of non-government subscribers.
• Complete withdrawal with no annuity provided corpus of up to 12 lakh (raised by increasing the threshold of 2.5 lakh)
• Without annuity Voluntary exit allowed up to 4 lakh corpus .
• Maximum age of annuity deferral was 85 .

3. Increased Flexibility of Withdrawals:

• The number of partial withdrawals rose to 6 times (3 times before)
• There must be 4-year period between partial withdrawals .
• Borrowed of NPS by marking lien.

4. Special Provisions:

• Subscribers who join at the age of above 60 are obliged to annuitize at least 20 % of the savings .
• Assures NPS to be retirement-oriented even to late entrants.