How to Deposit Money in an NPS Account?

What is an NPS Account Deposit?

A deposit in a National Pension System (NPS) account refers to the contributions made by an individual to their pension account, known as the Permanent Retirement Account Number (PRAN). The NPS, introduced by the Government of India in 2004, was initially designed for government employees but was made available to all citizens in 2009.

Contributions to an NPS account are highly flexible regarding amounts and frequencies. The only requirements are to make at least one contribution each year and ensure that the total annual contribution is at least Rs. 1000. This flexibility allows individuals to plan and manage their retirement savings according to their financial capacity and goals.

By contributing to an NPS account, individuals can build a substantial retirement corpus over time. The NPS also offers significant tax benefits, helping reduce taxable income. Overall, the NPS is a practical and advantageous option for retirement planning.

Now that you know the significance of contributing to the NPS account, here is a guide to learning how to add money to the NPS account.

How to Deposit Money in an NPS Account Online?

After opening an account, you should learn how to deposit money in your NPS account online. Here are the steps to follow:

Via eNPS Website:

• Visit the official eNPS website.
• Click the ‘Contribution’ option and select 'Contribution Online'.
• The eNPS portal will open where you must enter the NPS account number, PRAN number, date of birth, and other details.
• Select the SMS/email option to receive an OTP.
• Verify PRAN by entering the captcha and the OTP received on your registered mobile number or email address.
• Select the account type from Tier 1 and Tier 2, and enter the contribution amount you want to add.
• Choose the preferred payment gateway from debit card, credit card, or net banking, and click ‘Make Payment’.
• Enter the payment details to complete the payment.

Via UPI:

UPI is a real-time payment facility that immediately transfers funds from your mobile platform. To contribute via UPI, follow these steps:

• When selecting the payment option, choose UPI.
• Provide your VPA and receive a payment notification on your UPI application.
• Log in to the UPI app and confirm the payment.
• Enter MPIN to complete the transaction.

Via Mobile App:

• Install the NPS mobile app from the Google Play Store or App Store.
• Enter your PRAN number, NPS account number, date of birth, and captcha.
• Click ‘Verify PRAN’.
• Enter the OTP received on your registered mobile number or email address.
• Select the contribution amount.
• Select the payment gateway and click 'Make Payment.'
• The payment gateway will open where you can contribute via debit card, credit card, or net banking.

Depositing money into an NPS account online is secure, thanks to end-to-end encryption, two-factor authentication, and other robust security measures that keep your payment details safe and confidential.

How to Deposit Money in an NPS Account Offline?

 Follow these steps to deposit money offline:

• Visit your nearest bank or POP-SP office to request a contribution slip.
• Enter the required information, including the subscriber’s name, date of birth; NPS account number, PRAN number, contribution amount, mode of payment, etc.
• Duly check and submit the contribution slip to your nearest POP-SP.
• Collect the transaction receipt for future reference.
• Your money will be credited to your NPS account in T+2 days.

Tips for Depositing Money in an NPS Account

Now that you know how to deposit funds in an NPS account, follow these tips to ensure a smooth and safe transaction:

• Be aware of the minimum contribution requirements for Tier 1 and Tier 2 NPS accounts. For a Tier 1 account, you must contribute at least Rs. 1,000 per year, regardless of the number of transactions. In contrast, Tier 2 accounts have no minimum contribution requirements.
• The minimum online contribution amount is Rs. 500 for Tier 1 accounts and Rs. 250 for Tier 2 accounts.
• Verify with your employer whether they are willing to contribute to your NPS account.
• Explore the tax benefits you are eligible for with NPS contributions and plan your investment accordingly. Tier 1 account holders are eligible for deduction of Rs. 2 Lakh from taxable income under Section 80C and 80CCD (1) and 80CCD (1B) under old tax regime. However, Tier 2 NPS accounts do not provide any tax benefits.
• Once you complete the payment, check your transaction status by logging in to your NPS account and entering your PRAN number.

Conclusion

Understanding how to deposit money in an NPS account is crucial for effectively managing your retirement savings. Whether you choose to contribute online via eNPS, UPI, or a mobile app, or prefer the offline route through a bank or POP-SP office, the process is straightforward and secure. By following the steps outlined and considering the minimum contribution requirements for Tier 1 and Tier 2 accounts, you can ensure that your NPS contributions are handled smoothly. Regular deposits will help you build a robust retirement corpus, making the National Pension System a valuable tool for securing your financial future.

Frequently Asked Questions

Q: What is the deposit for NPS payment?

A contribution to an NPS account is called the deposit for NPS payment. Regular contributions let you accumulate wealth that you can withdraw at retirement.

Q: What are the benefits of an NPS deposit?

The major benefits of NPS deposits are lump sum payments at retirement, regular monthly pensions, and tax benefits.

Q: How much amount can I deposit in NPS?

You must contribute a minimum of Rs. 500 to a Tier 1 account and Rs. 250 to a Tier 2 account. There is no maximum limit.

Q: How many times can I deposit in NPS in a month?

There is no limit on the number of monthly deposits you can make.

Q: How do I deposit cash into my NPS account?

To deposit cash into your NPS account, visit a bank or POP-SP branch, complete a deposit slip, and submit the cash contribution.

Q: What is the best time to deposit money in an NPS?

It would help if you started contributing to the NPS as early as possible. Depositing money in your 30s is the best time to start NPS contributions.