How to Open an NPS Account Online in India

How to Open an NPS Account Online in India

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The National Pension System(NPS) (commonly called out as the National Pension Scheme/New Pension Scheme) is a government-backed retirement savings plan that enables Indians to build a financially secure future. This tax-saving scheme is regulated by the Pension Fund Regulatory and Development Authority (PFRDA) and provides a range of investment options to choose from. With NPS, individuals can save regularly and watch their money grow over time, ensuring a comfortable retired life.

NPS Account Openings are now simpler than ever, and in this blog, we will take you through the types of NPS Accounts, explain how to open NPS Account Online and more. Let’s begin.

Types of NPS Account

There are two types of NPS accounts: Tier 1 and Tier 2.

NPS Tier 1 Account: This is a non-withdrawable pension account that helps you save for your retirement. The contributions made to this account are invested in various assets such as stocks, bonds, and government securities. The accumulated corpus at retirement can be used to purchase an annuity from a life insurance company, which provides a regular income stream during retirement.
NPS Tier 2 Account: This is a voluntary savings account that allows you to make additional contributions over and above the mandatory contributions made to Tier 1. This account gives you more flexibility in terms of withdrawals and investment options. You can choose to invest your funds in a variety of instruments, including equity, debt, and liquid funds.

Difference between Tier 1 Account and Tier 2 Account

Here's a table outlining the differences between Tier 1 and Tier 2 accounts in the National Pension System (NPS):

Feature	Tier 1 Account	Tier 2 Account
Minimum Contribution	₹500 per year	₹250 per month
Maximum Contribution	No limit on the contribution amount	No limit
Lock-in Period	3 years for partial withdrawal*	Any time withdrawals
Withdrawal	Pre-mature exit is allowed after completing 5 years	Anytime and complete withdrawal allowed.
Tax Benefits	i. Employee/Individual Contribution: Employee’s/Individual contribution is eligible for tax deduction U/S 80 CCD (1) of IT Act upto 10% of salary (Basic + DA). This is within the overall ceiling of Rs. 1.50 Lacs under Sec. 80 CCE of IT Act. ii. Exclusively for NPS: Additional tax deduction available on contribution upto Rs. 50000 U/S 80CCD (1B). iii. Employer Contribution: The contribution in NPS by the employer in employee account upto 10% of Basic + DA is exempt from tax U/S 80CCD(2). This is over and above the limits of 80C. (Under new tax regime this is capped at 7.5lacs pa combined with employer providing PF, SAF & NPS contribution)	None
Investment Options	Multiple PFMs options and scheme preference.	Separate PFM and scheme
Risk Profile	Depends on the Subscriber’s choice	Depends on the Subscriber’s choice

In summary, Tier 1 accounts have a lower minimum contribution requirement but a longer lock-in period, while Tier 2 accounts offer zero balance and anytime complete withdrawal option plus separate investment option, separate nomination and choice of contributions

Salient Features of NPS Accounts

NPS accounts offer several unique features that make them attractive for retirement savings. Some of these include:

Flexible investment options: NPS allows you to choose from various asset classes, such as equity, corporate bonds, and government securities. You can also select the proportion of your investment in each class.
Portability: Your NPS account remains active even when you switch jobs or move to another city. You can easily access and manage your account online.
Tax benefits:

The tax benefit which is available for NPS subscribers as under:

Employee/Individual Contribution: Employee’s/Individual contribution is eligible for tax deduction U/S 80 CCD (1) of IT Act upto 10% of salary (Basic + DA). This is within the overall ceiling of Rs. 1.50 Lacs under Sec. 80 CCE of IT Act.
Exclusively for NPS: Additional tax deduction available on contribution upto Rs. 50000 U/S 80CCD (1B).
Employer Contribution: The contribution in NPS by the employer in employee account upto 10% of Basic + DA is exempt from tax U/S 80CCD(2). This is over and above the limits of 80C. (Under new tax regime this is capped at 7.5lacs pa combined with employer providing PF, SAF & NPS contribution)

Regulated by PFRDA: NPS is regulated by the Pension Fund Regulatory and Development Authority (PFRDA) of India, ensuring transparency and security for subscribers.

Eligibility and Prerequisites of NPS Account

NPS Account Opening requires meeting certain conditions. Firstly, applicants must fall within a specific age bracket, which currently stands at 18-70 years old. Additionally, Non-Resident Indians (NRIs) who meet the eligibility criteria can also apply.

Here are the key prerequisites for opening an NPS account:

Permanent Account Number (PAN) card: A unique identifier that links your NPS account to your personal information.
Active bank account: To facilitate transactions related to your NPS account, you need to have an active bank account.

By ensuring that these prerequisites are met, the NPS scheme can accurately record and safeguard your contributions until retirement.

Required Documents for NPS Account

When applying for an NPS account, you'll need to provide the following documents:

Identity Proof: Passport, Aadhaar Card, Voter ID, or Driver's Licence.
Address Proof: Utility bill, rental agreement, or property papers.
Photograph: Recent passport-size colour photo.
PAN Card: Self-attested copy of your PAN card.
Bank Details: Cancelled cheque leaf or bank certificate containing your name, account number, and IFSC code.

For NRIs, additional documentation may be required, such as a valid visa, work permit, or overseas citizenship proof.

Methods to open an NPS Account

An NPS Account opening can be done through these primary methods:

Via the Kotak app for Savings Account holders
Via the Kotak website
Via the NPS website

NPS Account Via the Kotak App

Open your NPS account swiftly via the Kotak App—effortless, paperless. Follow the simple steps demonstrated in the video to complete the process seamlessly.

how-to-open-nps-account-online-m

NPS Account Via the Kotak Website

Opening an NPS account online through Kotak's NPS portal: it’s a swift and paperless process. Here's what you need and the steps involved. Let's break down the documents required and the steps involved for each of the 5 registration methods for Kotak's "myNPS" portal:

1. Aadhaar Paperless Offline eKYC-based registration

Documents Required:

A valid Mobile number and Email ID
Aadhaar card
Scanned copy of photograph and signature in .jpeg/.jpg/*.png format (4KB - 5MB each)
Scanned copy of Cancelled Cheque in .jpeg/.jpg/*.png format (4KB - 2MB each)
Online payment of initial contribution (Minimum amount ₹ 500)

Steps Involved:

Visit the "NPS" section on the Kotak website.
Choose "Aadhaar Paperless Offline eKYC" as your registration mode.
Ensure your mobile number and email are linked to your Aadhaar.
Upload the required documents - photograph, signature, and Cancelled Cheque.
Make the initial contribution payment online.
Complete registration through OTP Authentication or eSign.
For cases without OTP/eSign, print the form, attach a photograph (without signature), and send it to Protean eGov with attestation.

2. Permanent Account Number (PAN) based registration

Documents Required:

A valid Mobile number and Email ID
PAN card
Scanned copy of photograph and signature in .jpeg/.jpg/*.png format (4KB - 5MB each)
Scanned copy of Cancelled Cheque in .jpeg/.jpg/*.png format (4KB - 2MB each)
Online payment of initial contribution (Minimum amount ₹ 500)

Steps Involved:

Visit the "NPS" section on the Kotak website.
Choose "PAN-based registration" as your mode.
Ensure your mobile number and email are linked to your PAN.
Upload the required documents - photograph, signature, and Cancelled Cheque.
Make the initial contribution payment online.
Complete registration through OTP Authentication or eSign.
For cases without OTP/eSign, print the form, attach a photograph (without signature), and send it to Protean eGov with attestation.

3. Driving Licence Registration

Documents Required:

A valid Mobile number and Email ID
Scanned copy of Driving Licence in Digilocker
Scanned copy of PAN card and Cancelled Cheque in .jpeg/.jpg/*.png format (4KB - 2MB each)
Scanned copy of photograph and signature in .jpeg/.jpg/*.png format (4KB - 5MB each)
Online payment of initial contribution (Minimum amount ₹ 500)

Steps Involved:

Visit the "NPS" section on the Kotak website.
Choose "Registration using Driving Licence" as your mode.
Ensure your mobile number and email are linked.
Complete authentication using your Digilocker Driving Licence.
Upload the required documents - PAN card, Cancelled Cheque, photograph, and signature.
Make the initial contribution payment online.
Complete registration through OTP Authentication or eSign.
For cases without OTP/eSign, print the form, attach a photograph (without signature), and send it to Protean eGov with attestation.

4. Registration using Aadhaar through Digilocker

Documents Required:

A valid Mobile number and Email ID
Scanned copy of Aadhaar card in Digilocker
Scanned copy of PAN card and Cancelled Cheque in .jpeg/.jpg/*.png format (4KB - 2MB each)
Scanned copy of photograph and signature in .jpeg/.jpg/*.png format (4KB - 5MB each)
Online payment of initial contribution (Minimum amount ₹ 500)

Steps Involved:

Visit the "NPS" section on the Kotak website.
Choose "Registration using Aadhaar through Digilocker" as your mode.
Ensure your mobile number and email are linked.
Authenticate using your Digilocker Aadhaar.
Upload the required documents - PAN card, Cancelled Cheque, photograph, and signature.
Make the initial contribution payment online.
Complete registration through OTP Authentication or eSign.
For cases without OTP/eSign, print the form, attach a photograph (without signature), and send it to Protean eGov with attestation.

5. KYC verification by POP (Point of Presence)

Documents Required:

A valid Mobile number and Email ID
Permanent Account Number (PAN) card
Existing active account (Account number/Folio number/Demat) with the empanelled POP for KYC verification after subscriber registration through myNPS.
Scanned copy of photograph and signature in .jpeg/.jpg/*.png format (4KB - 5MB each)
Online payment of initial contribution (Minimum amount ₹ 500)

Steps Involved:

Visit the "NPS" section on the Kotak website.
Choose "KYC verification by POP" as your mode.
Ensure your mobile number and email are linked.
Complete authentication using your existing active account with the empanelled POP.
Upload the required documents - photograph and signature.
Make the initial contribution payment online.
Complete registration through OTP Authentication or eSign.
For cases without OTP/eSign, print the form, attach a photograph (without signature), and send it to Protean eGov with attestation.

NPS Account Via NPS website

Opening an NPS account via the National Pension System (NPS) website is a straightforward process that provides you with a secure and efficient way to plan for your retirement. This method offers both online and offline options, catering to your convenience. In this comprehensive guide, we will walk you through the step-by-step instructions for both approaches, ensuring that you can make informed decisions about your financial future.

Online Method

Visit the eNPS Website: To begin your NPS journey online, access the official eNPS website at https://enps.nsdl.com/eNPS/NationalPensionSystem.html.
Link Your Aadhaar and PAN: Ensure that your mobile number, Aadhaar, and Permanent Account Number (PAN) are linked to your NPS account. This is a crucial step for online registration.
Aadhaar OTP Authentication: Complete the Aadhaar OTP (One-Time Password) authentication process. You will receive an OTP on your registered mobile number for verification.
Provide Personal Details: Fill in your personal details, including your PAN and bank account information. This information is vital for managing your NPS contributions.
Choose Investment Options: Decide whether you want your investments to follow the Auto Choice or Active Choice option. Auto Choice provides a default asset allocation, while Active Choice allows you to select specific investment options.
Select Pension Fund Manager (PFM): Nominate your preferred Pension Fund Manager (PFM) from the available options. Your PFM manages your NPS investments.
Upload Documents: Upload scanned copies of your photograph and signature as per the specified file format and size requirements.
Make an Initial Contribution: Make an online payment of your initial contribution, which should not be less than ₹500. This amount can vary based on your choice of investment.
Receive PRAN and Password: Upon successful registration, you will receive your Permanent Retirement Account Number (PRAN) and password, allowing you to access and manage your NPS account.

Offline Method

Locate a Point of Presence (PoP): Find the nearest Point of Presence (PoP) that offers NPS registration. These are typically banks and post offices.
Obtain NPS Subscriber Form: Request the NPS subscriber form from the PoP.
Complete the Form: Fill out the form with your personal details.
Provide KYC Documents: Attach photocopies of your Know Your Customer (KYC) documents, such as Aadhaar card, PAN card, passport, or other identity proofs.
Make Initial Deposit: Make an initial deposit into your NPS account, ensuring that it meets the minimum contribution requirement (usually ₹500) and covers the one-time registration fee of Rs. 400.
Receive PRAN and Password: After completing the offline registration process, you will receive your PRAN and password in a welcome kit.

How to login into your NPS account for the first time

Accessing your NPS account for the first time is essential to start managing your retirement investments. Follow these step-by-step instructions:

Visit the NSDL NPS portal: https://cra-nsdl.com/CRA/
Click on the "Login with PRAN/IPIN" option.
Enter your PRAN (Permanent Retirement Account Number) and the IPIN (Internet Personal Identification Number) provided in your welcome kit Or use the Reset option via OTP.
Solve the Captcha for security purposes.
Click on the "Submit" button.
You will gain access to your NPS account dashboard, where you can view your contributions, balance, and other account details.

How to Check an NPS Account Statement Online

Checking your NPS account statement online is a crucial step to monitor your investments. Here are the steps to do so:

Visit the NSDL NPS portal: https://cra-nsdl.com/CRA/
Log in using your PRAN (Permanent Retirement Account Number) and IPIN (Internet Personal Identification Number).
Navigate to the "investment summary" section
Select "Statement of Transaction."
Choose the relevant financial year for which you want to view the statement.
Your NPS account statement, including contributions and transactions, will be displayed for the selected period.

How to Check NPS Account Balance

Checking your NPS account balance is a simple process. Here are the steps to follow:

Visit the NSDL NPS portal: https://cra-nsdl.com/CRA/
Log in using your PRAN (Permanent Retirement Account Number) and IPIN (Internet Personal Identification Number).
Once logged in, your NPS account balance will be prominently displayed on your account dashboard.

NPS Withdrawal Framework

The National Pension System (NPS) Withdrawal Framework outlines the procedures and regulations governing the partial and complete withdrawal of funds from one's NPS account. Let’s explore how the withdrawal framework works.

Part Withdrawal: After 3 years of continuous participation, you can withdraw up to 25% of your individual contribution, and this amount is fully tax exempted. This partial withdrawal can be done three times, with a maximum limit of 25%, and it's allowed for specific purposes like illness, education, marriage, house construction, and self-development.
Premature Retirement: If you've participated for a continuous 5 years and wish to retire prematurely, you can withdraw 20% of the corpus as a lump sum, while the remaining 80% becomes your pension. This lump sum is also fully tax exempted.
Post Retirement: At the age of 60 or as per your corporate retirement age, you can make a withdrawal from your NPS. In this case, 60% of the corpus can be taken as a lump sum, and this amount is tax exempted, as per the Union Budget 2019.

Benefits of Online NPS Account Opening

The National Pension System (NPS), a scheme offered under the rules of the Government of India, is beneficial for those retired, ensuring a secure investment for investors.

Some of the major benefits of NPS with Kotak NPS platform are that it allows flexibility, is portable and opening an NPS account not only secures your future after retirement but provides a market-based return on your investment. Online registration and account opening for the National Pension System (NPS) has several benefits like market-based return, flexibility, convenience, avoidance of personal interaction, online advancement and quick responses.

In the online method of NPS registration, there are benefits of flexibility, accessibility, zero paperwork, Swift and Seamless Transactions and much more. Let’s explore them in detail.

Convenience and Accessibility: Online payment methods have transformed the NPS landscape by providing ease and accessibility. Subscribers can contribute to their pension funds from the comfort of their homes or workplaces using the Kotak NPS platform.
Swift and Seamless Transactions: Online payment methods ensure swift and seamless transactions. Through secure portals, subscribers can instantly transfer funds, eliminating delays associated with traditional payment modes.
Real-Time Monitoring: Online payment facilities enable real-time monitoring of contributions and account activities. Subscribers can conveniently track their investments, contribution history, and portfolio performance through the online portal.
Automation and Scheduled Payments: Automated online payments allow subscribers to set up recurring contributions, ensuring a disciplined and consistent investment approach. This feature encourages regular savings for retirement.
Secure Transactions: Advanced encryption and security measures in online payment platforms ensure the safety of financial transactions. This instils confidence in subscribers regarding the safety of their contributions.

Conclusion

In conclusion, the National Pension System (NPS) online registration and account opening process via Kotak's "myNPS" portal offer numerous advantages like convenience, swift transactions, real-time monitoring, and secure transactions. This paperless, accessible approach ensures a hassle-free experience, encouraging individuals to secure their retirement through flexible and market-based investments.

FAQs on How to Open NPS Account Online

1. When can I open a Tier II account?

A Tier II NPS Account Opening can be done along with a Tier I account at the outset or subsequently, providing flexibility.

2. Can I change the data in my NPS account?

Yes, you can update personal information like address and phone number by visiting online NPS login (cra-nsdl.com). Alternatively, by submitting modification forms through your Point of Presence (PoP)

3. Can I create more than one NPS account?

No, you are allowed only one Tier I NPS account.

4. Is it possible to open an NPS account offline?

Yes, visiting a Point of Presence (PoP), such as a bank or post office, allows you to open an NPS account offline.

5. How can I obtain a PRAN number?

Your Permanent Retirement Account Number (PRAN) is assigned upon successful registration of your NPS account, regardless of the registration method used.

6. Can NRI open an NPS account?

YES, Non-Resident Indians (NRIs) are not eligible to open an NPS Tier-1 account only. Also OCI subscriber can also opt for Tier-1 account

7. What is NPS, and why should I consider opening an account online?

NPS offers a structured platform for individuals, including salaried or self-employed individuals, aged between 18 to 70, to invest systematically and build a pension corpus.

8. Who is eligible for NPS online registration and account opening?

The NPS is a defined contribution scheme accessible to all Indian citizens aged between 18 to 70 years. Non-resident Indians (NRIs) and Overseas Citizens of India (OCIs) can also participate in this pension scheme.

9. What are the features and investment options available with NPS accounts?

NPS accounts offer features like portability, tax benefits, and a choice of investment options comprising equities, government securities, corporate bonds, and alternative investment funds, catering to varied risk appetites and retirement goals.

10. Is there a minimum or maximum contribution limit for NPS online accounts?

Yes, there are specific limits for contributions in NPS online accounts. The minimum contribution amount for NPS accounts is ₹500 per contribution in Tier I account, and there is no specified maximum limit for contributions. However, the maximum tax benefit is capped at ₹2 lakh per annum across various sections of the Income Tax Act.

11. Can I open both Tier I and Tier II NPS accounts online?

Yes, you can open both Tier I and Tier II NPS accounts online. Tier I is mandatory for NPS participants, while Tier II is optional and can be opened along with Tier I or separately, offering more flexibility in withdrawals but without the same tax benefits as Tier I.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.