How To Open an NPS Account Online

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Saving for the future is a no-brainer. I mean, what are you going to do when you no longer want to work, or you want a sabbatical. Schemes like the NPS were designed for exactly this. Learning about the NPS and how to open an NPS account should come in handy this tax season.

What is NPS?

The National Pension Scheme (NPS) is an investment plan aided by the government for everyone above 18 years of age, who want a regular flow of income in their retirement life. You can invest in this plan, and after maturity, it gives you returns in the form of income from the annuities. An individual has four options to invest in, under NPS, i.e., equity, corporate debt, alternative investment funds, and government bonds. Let's get into detail about this scheme and how to open an NPS account. 

Types of NPS Account

There are two account options for you under NPS. So, before you know how to open an NPS account, let's know about the types of NPS accounts.

Tier 1 Account

Tier 1 is the primary account of NPS. Anyone wishing to invest in NPS must open a Tier 1 account. This account could be opened with a minimum investment of ₹500 either online or offline. After that, you need to make a minimum contribution of ₹1,000 year. The maturity age of this account is 65 for the account holder. After maturity, 60% of the investment can be withdrawn (with applicable tax), and the rest of 40% is used to purchase annuities (without tax) that will bring regular monthly income. 

Tier 2 Account

Tier 2 is not a mandatory account under NPS. One may or may not choose to open it as per their interest. The minimum account opening investment is ₹1,000. Apart from this, you are not bound to make any minimum yearly contribution. You may or may not choose to deposit regularly. There is no lock-in period for Tier 2 accounts, so you can withdraw money whenever you want. 

NPS - How To Open: Steps To Open NPS Account

If you have planned already or may plan in the near future to open an NPS account, it is essential that you know how to open an NPS account. There are broadly two options for you, the online and the offline method. Either is fine, and you can choose as per your convenience or preference. 

How To Open an NPS Account Online (Tier 1)

The online method of opening an NPS account is as follows-

  • Go to the NPS website 
  • Choose one CRA
  • Now fill the form online with all the details correctly mentioned
  • After receiving the acknowledgement number, open your account within 15 days
  • You must complete your KYC
  • You will be asked for your bank details and a few documents 
  • Now make the payment of ₹500 (Tier 1 account) using your preferred mode of payment 
  • You will receive 12-digit PRAN after successfully account opening

You will also receive a confirmation SMS and mail on your registered email ID.

How To Open an NPS Account Online (Tier 2)

  • Visit eNPS
  • Click on 'activate Tier 2 account' 
  • Enter details like your date of birth, PRAN, and PAN 
  • Now click on 'verify PRAN' 
  • After verification, you will be required to pay ₹1,000 as an account opening contribution 
  • Your account will be opened

How to log in to an NPS account for the first time?

If you have successfully created your NPS account and are now eager to log in to your account, you can easily do so by using the PRAN number generated earlier. Other ways to log in are mentioned below-

NSDL NPS Portal

  • Go to the NSDL NPS website
  • Then, select the option "open your NPS account", then click on the option "login with PRAN/ PIN", then you'll be redirected to the login screen
  • Now you have to generate a new password by clicking on the option " password for e-NPS". 
  • Then the website asks for some of your details like PRAN, DOB, new password, and a captcha. After giving all these details, click on 'submit'
  • As soon as you complete this step, you'll receive an OTP on your registered mobile number.
  • Enter the OTP on the portal and confirm your new password to log in successfully

KARVY NPS PORTAL

  • Go to the official website of Karvy NPS. 
  • Then select the option "login for existing subscribers".
  • Now, you'll be redirected to a login page. Here you have to select the option "click here to generate a new password". Then select "Reset your password".
  • Now, the portal asks to enter PRAN, DOB, and a captcha. 
  • Then click on "submit" and then enter the OTP received on your registered contact number.

Internet Banking

  • Firstly, log in to your internet banking account
  • You'll find a tab named "Services", go to the option "NPS" and click on it
  • Here in the NPS section, you can have a look at all the details of your NPS account, including the transactions made

Documents required to open an NPS account

Before going about opening an NPS account, you must first have a list of the documents required. The documents mentioned on the NSDL website that is required for opening an NPS account are as follows:

  • Aadhar paperless offline e-KYC zip file
  • Scanned copy of the cancelled cheque and the PAN card in jpeg, jpg, png, and pdf forms. The size of these files should be between 4 KB to 2 MB
  • Scanned passport size photograph and signature in jpeg, jpg, or png format and the size of these files should range between 4 KB to 5 MB.

If the KYC process is not done earlier, the documents required for opening an NPS account online are:

Address proof documents like: 

  • Depository account copies
  • Driving licence
  • Electricity bill
  • ID proof from a local gazetted officer, municipal councillor, MP, MLA
  • PAN card
  • Identity card issued by the employer
  • Water bill
  • School leaving certificate
  • Rent receipt

Date of birth proof

  • ID Proof like:
  • Driving licence
  • PAN Card
  • ID proof from a local gazetted officer, municipal councillor, MP, MLA
  • School leaving certificate
  • Identity card issued by the employer

Summing it up

Opening an NPS account is very straightforward. Any Indian citizen between the age of 18 to 60 years of age can apply for NPS. Also, the individual must comply with the KYC norms.. Retirement planning is something that most of us don’t consider until the very last minute, and with schemes like these, it only indicates that we need to start planning early if we want to live a stress-free retired life.

FAQs

  • What is the NPS interest rate? 

There is no fixed interest rate on NPS. Depending on the investment scheme you choose under NPS and the performance of your scheme, you get returns. However, an average return witnessed is somewhere between 9%-12%.

  • How can I open an account in NPS? 

You can either visit the official website of NPS, eNPS or visit your nearest PoP-SP to open your NPS account. Apart from this, you can also check the NPS section of F.I Money for further information

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