NPS Revamp: Flexible Drawdown Options To Provide Monthly Income

(MENAFN- Live Mint) India's pension regulator has introduced retirement income schemes (RIS) and drawdown options under the National Pension System (NPS), allowing subscribers to choose phased withdrawals from their pension corpus after retirement while remaining invested in the scheme.

The regulator said the move aims to provide subscribers“more flexible periodic payout options during their decumulation phase while continuing to support corpus appreciation through the retirement income schemes”.

Also Read | PFRDA launches NPS Swasthya: Use pension funds for healthcare expenses

According to a circular issued by the Pension Fund Regulatory and Development Authority on 15 May, subscribers who opt for the facility will be allowed to receive payouts on a periodic basis - monthly, quarterly or annually - for up to 85 years of age, or as per the choice exercised by the subscriber when exiting NPS.

Under the RIS framework, subscribers will have the flexibility to choose phased withdrawals of their designated pension corpus through any drawdown option.

“Consequently, these withdrawals shall have no impact on the mandatory annuitisation requirement of 20% or 40% of the corpus, as the case may be, thus ensuring that the minimum statutory requirement for a life-long pension remains intact,” the circular read.

The drawdown options will be available to both government and non-government subscribers under NPS.

Also Read | What is NPS Sanchay? Check eligibility, withdrawal rules and investment details

PFRDA said the effective date for these guidelines will be announced once the necessary technical systems and operational frameworks are in place. The regulator noted that these guidelines were issued under the authority granted by Section 14 of the PFRDA Act, 2013. It said the initiative has been introduced in line with the PFRDA (Exits and Withdrawals under the NPS) (Amendment) Regulations, 2025.

According to latest PFRDA data, the NPS had more than 21.7 million subscribers and more than ₹16 trillion in assets under management as of March 2026.

NPS Swasthya for healthcare expenses

On 10 April, Mint reported that PFRDA now allows subscribers under 'NPS Swasthya', a multi-partner initiative that integrates retirement savings with healthcare accessibility, to get coverage for in-patient services and hospitalisation bills.

Also Read | NPS Vatsalya: Eligibility, investments, withdrawal and exit rules, explained

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