NEW DELHI: For the benefit of subscribers to the National Pension Scheme (NPS), the Pension Fund Regulatory & Development Authority (PFRDA) has made the upload of withdrawal/KYC documents mandatory.

"The upload of the documents shall be required with effect from 1st April 2023 in the interest of Subscribers and to benefit them with prompt payment of annuity income, "The oversight authority released a statement.

NPS withdrawal paperwork: The NPS subscribers and the associated nodal officers/POPs/corporate are required by PFRDA to make sure that the following papers are uploaded in the appropriate CRA user interface and that they are readable: 

1) NPS Exit/ Withdrawal Form 2) Proof of Identity and Address as specified in the Withdrawal form, 3)  Bank account Proof 4)  Copy of PRAN card.

When will the new NPS exit guideline be put into effect?:  As on April 1, 2023, submitting the aforementioned documents will be necessary to submit in order to depart NPS.

How will the new NPS withdrawal rule help subscribers?: On November 20, 2022, PFRDA will simplify the annuity buying process in regulatory coordination with IRDAI. The NPS withdrawal form submitted by subscribers at the time of exit at nodal officers / POPs must be used by Annuity Service Providers (ASPs) in order to issue annuities.

"The common proposal for Exit from NPS and for acquiring annuity from ASP enables parallel processing of Lump sum component and Annuity due to which the time taken by ASPs when issuing Annuity Policies is significantly reduced, resulting in quicker Subscriber servicing and timely Annuity issuance, "in a circular dated February 22, 2023, according to PFRDA.

How do subscribers begin a system-wide online exit request?: According to PFRDA, these are the methods for processing exit requests from subscribers who are government or non-government entities in a paperless manner.

a) After logging into the CRA system, the subscriber will start an online exit request.

b) The subscriber is shown the pertinent notifications regarding e-Sign/OTP authentication, Nodal Office/POP authorization, etc. at the moment the request is initiated.

c) When a request is initiated, information from the NPS account, such as the address, bank information, nominee information, etc., is automatically filled in.

d) The subscriber will choose the annuity specifics, fund allocation %, and lump sum amount.

e) The Subscriber's (CRA-registered) bank account will be validated via online bank account verification (Penny drop facility).

f) Upon submitting an exit request, the Subscriber is required to upload KYC documents (Identity and Address Proof), a copy of their PRAN card or ePRAN, and bank documentation.

g) Scanned papers must be appropriate, with legible scanned images.

h) To make the procedure paperless, the subscriber authorises the request by choosing one of the two methods listed below:

OTP Authentication: Unique OTPs will be provided to the subscribers' mobile numbers and email addresses.
Aadhaar will be used by subscribers to electronically sign the request.

How do NPS exit rules work?: Subscribers may withdraw from the National Pension System (NPS) in the following situations: upon turning 60 or reaching superannuation; prior to turning 60 or reaching superannuation; at any time after turning 60 until 75; due to physical incapacity or upon suffering a bodily disability before turning 60 or reaching superannuation; due to death or the subscriber being reported missing.

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