NPS subscribers now can change asset allocation 4 times a year

Because there has been a demand to increase the limit, the pension fund regulator PFRDA has allowed NPS subscribers to change their investment pattern up to four times during a financial year. 

Earlier the NPS subscribers were allowed to change their investment pattern twice per financial year.

"A person's investment choice can be changed twice a year. We're going to increase it to four times in a short period of time because there have been requests to allow more times (to change the investment pattern) "During a webinar on the NPS scheme hosted by industry body Assocham, as per PFRDA Chairman Supratim Bandyopadhyay.

PFRDA's only caution is that it is a long-term investment (product) for building a pension corpus and should not be treated as a mutual fund scheme, he said.

PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY

CIRCULAR

Circular No: PFRDA/2022/02/PDES/01

Date: 27th January 2022

To
All Stakeholders under NPS

Subject: Change of Pension Fund and Asset Allocation by NPS subscribers

1. In supersession of PFRDA Circular no: PFRDA/2017/8/PD/2 dated 1st March 2017, it has been decided that:

1. Under All Citizen Model and NPS Corporates Sector Model, the subscriber or employer, as the case may be, shall have the option to change the investment choice / asset allocation (changing between Auto Choice and Active Choice or to change the ratio of allocation among asset classes under Active Choice) four times in a financial year.
2. The above choice shall be available for Tier | and Tier I! accounts, separately.
3. For Tier Il accounts, subscribers across all sectors (i.e. Government Sector, All Citizen and Corporate) will have the above choices.
4. Choice to change Pension Fund will remain once in a financial year.

2. This will take effect from 1st February 2022.

(Mong Phukon)
Chief General\Manager