Homenew pension scheme

Default ASP and Annuity Scheme for subscribers exiting from NPS and Seeking withdrawal of Accumulated Pension Wealth

Pension Fund Regulatory and Development Authority         

CIRCULAR

PFRDA/2013/5/PDEX/4

14th February’2013

To,
All POP’s/Aggregators/CRA/ dealing offices of Central & State Governments,

Subject: Default ASP and Annuity Scheme for subscribers exiting from NPS and Seeking withdrawal of Accumulated Pension Wealth.

PFRDA has empanelled seven Annuity Service Providers (ASP’s) for providing annuity services to NPS subscribers. As per current National Pension System (NPS) exit norms, the subscriber is mandatorily required to select one of the empanelled ASP’s along with an Annuity scheme from those offered by the chosen ASP at the time of exiting from NPS and seeking withdrawal of accumulated pension wealth (for reasons other than death of the subscriber). 
Based on the feedback received from stakeholders seeking provision of a default option to be exercised by the subscriber at the time of selection of the ASP and choosing of an annuity scheme, PFRDA has examined the matter and decided to assist the subscriber by providing a default option.

After examining the various options provided by the different ASPs, it has been decided to provide for a default ASP and annuity scheme as below:

  1. Default Annuity Service Provider – Life Insurance Corporation of India
  2. Default Annuity Scheme – Annuity for life with a provision of 100% of the annuity payable to spouse during his/her life on death of annuitant’ and Under this option, payment of monthly annuity would cease once the annuitant and the spouse die or after death of the annuitant if the spouse pre-deceases the annuitant, without any return of purchase price.   
  3. However, where the corpus is not adequate to buy the default annuity variant and from  the  default ASP, the subscriber has to compulsorily choose an ASP who offers an annuity at the available corpus in the account of the subscriber.

Also, it may be noted that this default option is being purely provided in the subscribers’ interest and to avoid any delay in claim processing and is not with a view to endorse/promote any particular ASP or annuity variant being offered by the ASP.  
The default ASP and the default annuity scheme as above would be applicable for all variants of NPS i.e. Government Sector, Swavalamban and those accounts under NPS lite platform not able to meet the compulsory contribution under Swavalamban scheme, Corporate and All Citizen model. 
This is for the information of all concerned.   The circular has also been placed on PFRDA website at  http://www.pfrda.org.in and CRA website at http://www.npscra.nsdl.co.in.
Yours Faithfully,
Sd/-
Venkateswarlu Peri
General Manager

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COMMENTS

WORDPRESS: 1
  • Anonymous 9 years ago

    Note the line ' without return of purchase price'.

    LIC/SBI pension offers 100% annuity to spouse after death as well as full capital/purchase price return to nominees.

    Default Scheme is not good as it eats your money after death.

    They will just pay 5-6% interest on money as pension and will consume all money after death.

    Its just a cheating to all the poor/rich people.

    PRDFA should have never agreed this kind of default scheme.

    Their statement that this will speed up the claim says that you will have a lot of trouble in claims if you opt for some other type of scheme.

    It tells all that there are groups behind to digest your money.

    NPS could have been very good option for pension but there are perhaps people who see the opportunity to digest the money.