The central government has launched a new pension program called NPS Vatsalya Scheme. This scheme is for minor children, with contributions from parents and guardians. Once the child reaches the age of majority, this plan will seamlessly convert to a regular NPS account. This plan will help secure the child’s financial future.
The NPS Vatsalya Scheme will promote savings habits in children. Under the NPS Vatsalya scheme, you can open an account with a minimum of ₹1,000. After this, the parent or guardian must deposit at least ₹1,000 annually until the child turns 18. Payments will begin once the child turns 18.
NPS Vatsalya Scheme – Key Highlights
| Scheme Name | NPS Vatsalya Scheme |
| Scheme | It is a subset of NPS, which is regulated by PFRDA. |
| Eligibility | All minor Indian citizens (under 18 years of age) |
| Account Operator | Only parents can open, deposit or withdraw funds from the account. |
| Account Beneficiary | Only the minor children can be the beneficiary |
| Minimum Contribution Limit | For Account Opening: Rs. 1,000 p.a., For Annual Contribution: RS. 1,000 p.a., |
| Maximum Contribution Limit | No maximum contribution limit |
| Interest Rate | 9.5 % to 10%. |
| Website | https://npstrust.org.in/open-nps-vatsalya |
What is NPS Vatsalya?
NPS Vatsalya is a contributory pension system under the National Pension System (NPS). This scheme is designed specifically for minors. NPS scheme allows parents to open accounts for their children and contribute towards their retirement savings. The minimum contribution is ₹ 1,000 per year, and there is no limit on the maximum contribution.
Who can open an account
All parents who are citizens of India can open an account for their children under the NPS Vatsalya Scheme. Deposits under NPS Vatsalya earn compound interest, helping them secure their children’s future. NPS Vatsalya Scheme allows parents to arrange funds for the future of their children.
Udyam Portal Registration, Eligibility, Download Certificate Pdf
Recuired Documents for NPS Vatsalya Scheme
- Identity proof for the guardian (Aadhaar card, PAN card, passport or driving license, etc.)
- Address proof: (Any official document confirming current address)
- Age proof for the minor
- Identity proof for minors
- Mobile number
- Email ID
- Photograph
How to Open an NPS Vatsalya Account Online
Step 1: Visit the NPS Trust Website https://npstrust.org.in
Step 2: On the home page click, “Open NPS Vatsalya”
Step 3: Subscriber will be directed to the page where the choice of any of the three CRAs can be made.
Step 4: On selecting the CRA, subscriber needs to enter the basic details of the Minor and the Guardian and complete OTP authentication.
Step 5: KYC details of the guardian such as Name, Date of Birth, Gender, Address, and Photo will be fetched from UIDAI database.
Step 6: FATCA details and declaration to be entered and the choice of Investment Option should be made.
Step 7: Details to be verified through OTP authentication through email and mobile number.
Step 8: Initial contribution amount of Min Rs 1000/- to be made
Step 9: PRAN will be generated after successful payment.
Children who deposit money in the NPS-Vatsalya scheme can withdraw funds after they turn 18. Withdrawals are only available three times until the child turns 18. The NPS Vatsalya scheme is a pension plan for children.
How to Open an NPS Vatsalya Account Offline
- Visit a Point of Presence (PoP) like a bank or registered service provider.
- Ask for the NPS Vatsalya registration form.
- Fill out the form and submit it with the required documents.
- Make the first payment at the PoP (minimum ₹1,000).
Withdrawal and Exit Rules of NPS Vatsalya
NPS Vatsalya Scheme provides for partial withdrawal before the child turns 18 years old. The conditions for partial withdrawal from the NPS Vatsalya account are as follows:
- Parents or guardians can withdraw after 3 years of joining NPS
- They can withdraw up to 25% of contributed amount
- Withdrawal option is available only 3 times till the child turns 18
- They can withdraw for the purposes of education, disability of more than 75%, treatment of specified illnesses, etc., as specified by the PFRDA
Once the child reaches the age of majority (18 years), the NPS Vatsalya Scheme can be converted into a regular NPS account. The accrued contribution amount in the NPS Vatsalya amount will be transferred to the standard NPS account. It promotes the government’s commitment to enhance financial planning and provide a dignified future for all citizens.
Frequently Asked Questions (FAQs)
What is NPS Vatsalya Scheme?
The NPS Vatsalya Scheme is a government saving scheme for parents to create a retirement savings account for their minor children.
Who is eligible for NPS Vatsalya Scheme?
All parents or guardians of minor children (below 18 years) are eligible to open an NPS Vatsalya Scheme account for their child.
How to apply the NPS Vatsalya Scheme?
You can apply either online via the eNPS portal or offline at a Point of Presence (PoP) like a bank.
How many NPS Vatsalya accounts can I open?
The guardian can open a single account (per child) for the minor.
Is NPS Vatsalya a good investment?
NPS Vatsalya Scheme is a good investment for parents who want to create a retirement fund for children.