NPS Vatsalya scheme, which will run under the aegis of Pension Fund Regulatory and Development Authority (PFRDA), is a part of the government’s formal launch across the country by Sitharaman in New Delhi today.
The NPS Vatsalya scheme was officially launched today by Finance Minister Nirmala Sitharaman nearly two months after she announced the mega saving-cum-retirement financial plan for minors in the Union Budget 2024-25.
Following the formal launch of the mega scheme by the FM, banks like ICICI Bank and Axis Bank announced the launch of the pension scheme aimed at securing the financial future of children.
The scheme, which will run under the aegis of Pension Fund Regulatory and Development Authority (PFRDA), is a part of the government’s formal launch across the country by Sitharaman in New Delhi today.
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Where can you open NPS Vatsalya account?
NPS Vatsalya account can be opened offline and online both. Parents can open NPS Vatsalya account for their kids through Points of Presence (POPs) which include major banks, India Post, Pension Funds, etc. and the online platform, e-NPS.
They can also visit any ICICI Bank business centre across the country and Axis Bank branches to open the NPS Vatsalya account for their children.
ICICI Bank inaugurated the commencement of the scheme by registering accounts of a few children under NPS Vatsalya. They also received a symbolic Permanent Retirement Account Number (PRAN) card for their NPS Vatsalya account.
Sriram H, Head – Deposit Products, ICICI Bank said, “We are delighted to be part of the NPS Vatsalya launch scheme with the Government of India and PFRDA. We have begun this journey by opening our first set of NPS Vatsalya accounts today. We have equipped all ICICI Bank business centres across the country to open the NPS Vatsalya account for customers. This account helps in long-term wealth creation, ensuring that by the time the minor becomes an adult, there is a financial corpus in place for them.”
Key attributes of the Vatsalya NPS account:
·Eligibility criteria: Any minor, having PAN card and Aadhar card, who is under the age of 18 is eligible
·Minimum contribution: A minimum of Rs 1,000 per year can be contributed with no limit on maximum contribution
·Contributors to the scheme: Parents/guardians can contribute on behalf of their children
·Transition after the age of 18: The minor’s NPS account will transition to a standard NPS account, post the submission of required KYC documents.
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How will NPS Vatsalya work?
Kurian Jose, CEO, Tata Pension Management, explains, “Account is opened in the name of minor and operated by Guardian and the minor is the sole beneficiary of the same. Upon attainment of age of 18 years, this account can be shifted seamlessly to NPS Tier – I (All Citizen). All features of investing through Auto Choice / Active Choice can be utilised for the same as well.”
By encouraging early investment and providing a structured savings plan, NPS Vatsalya aims to build a robust financial foundation for young individuals, he said adding that this innovative approach not only ensures that children receive the benefits of disciplined saving and compounding over time but also fosters a sense of financial responsibility from an early age.
