NPS Exit Rules :NPS Subscribers Can Opt for Any Annuity Plan without Extra Fees

The Pension Fund Regulatory and Development Authority (PFRDA) has recently introduced significant relief for the millions of subscribers of the National Pension System (NPS).

In a recent notification issued on July 27, 2023, the PFRDA clarified the exit rules for the pension scheme, allowing NPS subscribers to choose any annuity plan at the time of exit, without incurring any additional charges.

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Simplified Exit Process:

The PFRDA’s latest move aims to simplify the exit process for NPS beneficiaries. Now, when subscribers wish to exit the scheme upon retirement, they can do so easily and hassle-free.

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The government, Point of Presence (POPs), and Nodal Officers of the National Pension System Trust have been directed to assist NPS subscribers in selecting an annuity plan that suits their needs, eliminating any potential difficulties for the beneficiaries.

No Extra Charges for Annuity Selection:

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In addition to simplifying the exit rules, the PFRDA has assured subscribers that they will not face any extra charges for choosing an annuity service.

The notification emphasizes that insurance companies can only charge premiums from NPS subscribers, as they are already paying taxes to the government.

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Hence, there should be no pressure on subscribers to pay any additional fees for other services.

Understanding NPS Exit Rules:


According to PFRDA rules, NPS subscribers can withdraw 40% of their funds at the time of maturity. The remaining 60% can be withdrawn in one go.

However, if the total amount is less than Rs 5 lakh, subscribers have the option to withdraw the entire amount at maturity.


For those interested in purchasing a pension plan before the age of 60, at least 80% of the NPS corpus must be utilized.

With the PFRDA’s latest measures, NPS subscribers can now look forward to a smoother exit process and greater flexibility in choosing annuity plans, without any financial burden.

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This move is expected to enhance the overall experience for NPS beneficiaries and encourage more individuals to participate in the National Pension System.


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