NPS Contribution: Your Ultimate Guide to Investing in the National Pension System for a Secure Future

Last Updated : March 28, 2023, 12:58 p.m.

The National Pension System is one of the multiple retirement perks the Indian Government launched to facilitate sufficient financial assistance after retirement. If you are a working individual, you can lead a comfortable life post-retirement in old age after a hustle lifetime is quite appealing. Suppose you want to invest in the National Scheme and enjoy its benefits, but you do not know much about NPS contribution . In that case, the article will guide you online and offline throughout the procedure. Thus, scroll down below and get a detailed idea about NPS contribution online .

What is the National Pension Scheme Contribution?

The National Pension Scheme, popularly known as the NPS, is a retirement benefit scheme. It is designed to provide a consistent income source after retirement. If you are above 18 years, you can contribute towards the scheme. Employers can make NPS contributions online on behalf of their employees. Sometimes, private limited companies include the National Pension Scheme as a part of employee privileges. Similarly, NPS contributions for people employed in the government sector can also enjoy the benefits. Non-resident Indians can invest in the National Pension Scheme.

You can become a subscriber of the National Pension Scheme and invest periodically. Your periodical investments are known as NPS contributions throughout your employment. After you retire, you can withdraw a certain percentage of your total investment. The leftover amount would be available in the form of monthly payouts. Every citizen of India can become a subscriber of the National Pension Scheme and contribute to avail of the National Pension Scheme privileges.

With the help of NPS contributions, you can invest your hard-earned money and work towards building a retirement corpus. After retirement, you can withdraw approximately sixty per cent of the corpus as a lump sum and utilise the leftover corpus to invest in annuities that will give you your pension amount post-retirement. Your retirement corpus’s size is based on your contributions’ value, the investment duration, and the returns you and your pension fund manager achieve.

How Can You Contribute Towards the National Pension Scheme?

To contribute towards the National Pension Scheme with the help of online and offline methods, it will help you if you have a National Pension Scheme subscription and a Permanent Retirement Account Number. If you are employed in the government sector, you are automatically subscribed to the NPS and have a PRAN number.

Whereas, if you are employed in the private sector or self-employed, you can sign up voluntarily and become a National Pension Scheme subscriber. You can sign up under the All Citizens section of the scheme. After completing your registration successfully, you get an exclusive Permanent Retirement Account Number, and you can make NPS contributions online and offline.

Ways to Contribute Towards the National Pension Scheme Through the Online Procedure

To make an NPS contribution online , you can follow the steps given below:

• You can visit the official e-NPS website.
• Under the NPS section, you can visit the contributions tab to contribute.
• You can fill up the subscriber-contribution form, where you can enter details such as birthdate, one-time password request, PRAN number, National Pension Scheme subscription type, etc.
• After successful authentication, you will receive a one-time password on your registered mobile number or verified email address.
• A one-time password is necessary to verify your PRAN number.
• After successful verification, the next web page will display the NPS contribution page. You can contribute to National Pension Scheme Tier 1 and 2 accounts. You can make NPS payments online with the help of a debit, credit card, or internet banking facility.
• The NPS online payment attracts National Pension Scheme contribution charges. The e-National Pension Scheme Point of Presence charges a service fee of Rs 0.10% of the contribution amount. The fee is subjected to a minimum amount of Rs. 10 and a maximum amount of Rs. 10,000. Nonetheless, the fees do not apply to e-National Pension Scheme subscribers.

Ways to Contribute Towards the National Pension Scheme Through the Offline Procedure

For contributing towards the National Pension Scheme through the offline procedure, you can submit the NPS Contribution Instruction Slip at your registered Point of Presence-SP. Using separate contribution slips for National Pension Scheme Tier 1 and 2 accounts is mandatory. You can fill up the below-mentioned details in the form:

• Name of the Subscriber, Permanent Retired Account Number, Amount you will contribute, and a demand draft or a cheque.
• If you are working in the government, you can mention your joining date; if your joining date is before January 1, 2004
• Suppose you are employed in the government sector, and your joining date is after January 1. 2004. In that case, you can contribute to your National Pension Scheme Tier 2 account with the help of the National Pension Scheme Contribution Instruction Slip.
• In addition to the contribution form, submitting a Permanent Account Number card copy for cash deposits of more than Rs. 50.000 is mandatory.
• In the case of offline contributions in cash, demand draft, or cheque, the OPI-SP service fees are 0.25% of the amount contributed. A minimum fee of Rs. 20 and a maximum fee of Rs. 25.000 per transaction.

How Can You Download the National Pension Scheme Contribution Form?

To download the NPS contribution form, you are required to visit the official website of the National Securities Depository Limited. Under the National Pension Scheme account maintenance, you can click the first form- National Pension Pension Scheme Contribution Slip. The form will get automatically downloaded in word format. You can alter the word document, fill out the form, and submit it online or print the form and submit the filled form at a Point of Presence-SP.

Fees for National Pension Scheme Contributions Online

Contributions towards the National Pension Scheme fascinate specific National Pension Scheme gateway fees and NPS payments online . Given below are the ways you can use to make NPS online payments :

• Internet Banking
• Credit Card
• Debit Card

You can opt for internet banking to make NPS online payments because it can be cheap. There are two payment gateways- SBIePay and Billdesk. You can opt for the one which you find convenient.

Conclusion

You can make NPS contributions if you follow both offline and online methods. Your contributions towards the National Pension Scheme can aid you in securing your future financially and reduce your income tax burden.