The premature exit regulation for NPS Lite Swavalamban scheme subscribers has been changed by the Pension Fund Regulatory and Development Authority (PFRDA). NPS Lite subscribers can now exit before the statutory 25-year period if their accumulated pension corpus is less than Rs 1 lakh and if they are not eligible to migrate to the Atal Pension Yojana, according to a new law set by the regulator.
According to the Circular. No. PFRDA/2021/21/SUP-NPST/1 issued on July 02, 2021, PFRDA has clarified that "as per the 6th Amendment of Exit Regulations, the Swavalamban Subscribers whose accumulated pension wealth do not exceed one lakh rupees and if they are not eligible to migrate to Atal Pension Yojana (APY), can opt to prematurely exit with lump sum payment."
The regular further added that "those eligible Subscribers as mentioned above are not required to continue in the Swavalamban scheme for minimum period of twenty-five years irrespective of the receipt of Govt of India (GoI) co-contribution under Swavalamban by them. However, if GoI's co-contribution was availed by those eligible Subscribers and the same shall be deducted along with the returns generated from the corpus at the time of their exit."
For calculating the overall corpus for premature exit from NPS Lite, PFRDA has also stated with an example that "the accumulated corpus of those Swavalamban Subscribers is to be calculated after deducting Government's co-contribution, if any, and the returns thereon. For example, a Swavalamban Subscriber who is aged 43 Years (who could not be migrated to APY) has a corpus of Rs 1,04,000 in his Swavalamban PRAN and out of which, GoI's co-contribution and returns constitute Rs 4500. The Subscriber shall be eligible for premature exit since the accumulated corpus in the PRAN would be Rs 99500 (Rs 104000-Rs 4500=Rs 99500)."
For the submission of withdrawal claims, PFRDA has disclosed that "those Swavalamban Subscribers who fulfill the above criteria, and if they wish to prematurely exit, can submit their withdrawal claims to the associated POPs/Aggregators. Central Record Keeping Agency (CRA) is advised to communicate to the eligible Swavalamban Subscribers and POP/Aggregators about the clarification thus provided above."