Important updates for NPS subscribers: New charges and security measures announced by PFRDA
Charge structure for Point of Presence (PoP)
In a master circular dated April 25, 2024, the PFRDA stated that Points of Presence (PoPs) can negotiate fees with NPS subscribers, but they must stay within the set minimum and maximum charge limits.
Highest and lowest fees allowed
According to the master circular dated April 25, 2024, a “persistency charge” will apply to accounts in the National Pension Scheme’s All Citizen Model if the subscriber stays with a Point of Presence (PoP) for more than six months in a financial year. This fee will be charged once a year to the relevant PoPs by deducting units from the subscriber’s NPS account after the financial year ends.
PFRDA master circular dated April 25 as sourced by ET
New security measures in NPS
In a circular dated April 1, 2024, the PFRDA announced an upgrade to the security of the NPS. They introduced a new layer of security based on Aadhaar, using two-factor authentication. This security measure is mandatory for all users with password-based access to the Central Recordkeeping Agency (CRA) system, starting from April 1, 2024.
PFRDA also mentioned that government nodal offices can use Aadhaar One-Time Password (OTP) for two-factor authentication on the CRA and NPSCAN systems. In a circular dated March 15, 2024, PFRDA outlined the process for Aadhaar mapping. The oversight office (PrAO/DTA) must first connect Aadhaar with the CRA User ID. Similarly, PAO/DTOs must link their Aadhaar to their CRA User ID for DDOs to start the Aadhaar linking process.
Safety practices for government nodal offices
On March 27, 2024, the PFRDA released a new circular titled ‘Digital Safety Practices for Government Nodal Offices Under NPS Architecture Advisory, 2024’. This circular requires that when government nodal offices digitize and upload documents onto the Central Recordkeeping Agency (CRA) system, they must verify the information from the Subscriber Registration form and supporting Know Your Customer (KYC) details with official valid documents (OVDs) and the employee’s service records.
In the same circular, the PFRDA updated the process for exiting or withdrawing from the NPS. According to the new guidelines, when processing an exit or withdrawal request on the CRA system, the information given by the subscriber or claimant must be checked against supporting documents and the employee’s service records. This verification step is important to ensure that all details are accurate before the request is approved.
However, the PFRDA stated that users must follow the instructions of the CRA system without deviation when processing exit, withdrawal, or claim requests. Additionally, proper due diligence, certification, and digital authentication (such as Aadhaar authentication) must be completed before submitting or approving any requests in the CRA system.