About National Pension System
Loanpao’s National Pension System (NPS) is a government-backed retirement scheme designed to build a pension corpus through market-linked investments. With flexible contributions and tax benefits, NPS offers Tier I (pension account) and Tier II (voluntary savings) options for long-term wealth creation.
Why Choose NPS?
- Account Types: Tier I (mandatory, restricted withdrawals) and Tier II (voluntary, flexible)
- Minimum Contribution: ₹500/month or ₹6,000/year (Tier I); ₹250/month (Tier II)
- Expected Returns: 8–10% annually (market-linked)
- Tax Benefits: Up to ₹1.5 lakh (Section 80C) + ₹50,000 (Section 80CCD(1B))
- Flexibility: Choose equity, debt, or balanced funds
- Retirement Benefit: 60% corpus withdrawable tax-free; 40% for annuity
- Regulation: Overseen by PFRDA for transparency
Are You Eligible?
| Criteria | Requirement |
|---|---|
| Applicant Type | Indian citizen or NRI |
| Age | 18–65 years for Tier I; 18–70 years for Tier II |
| KYC Compliance | Mandatory for all subscribers |
| Bank Account | Active savings account for contributions |
| Minimum Contribution | ₹500/month or ₹6,000/year (Tier I) |
What Documents Do You Need?
- KYC: Aadhaar, PAN, or passport
- Address Proof: Utility bill or rental agreement
- Bank Details: Cancelled cheque or bank statement
- Photograph: Passport-size
- Application Form: NPS subscriber form
Indicative Returns
| Fund Type | Asset Class | 5-Year Annualized Return |
|---|---|---|
| Equity Fund (E) | Stocks | 9–11% |
| Corporate Bond Fund (C) | Corporate Debt | 7–9% |
| Government Securities Fund (G) | G-Secs | 6–8% |
| Balanced Fund (Auto Choice) | Mix of E, C, G | 8–10% |
Extra Charges:
- Fund Management Fee: 0.01–0.09% annually
- CRA Charges: ₹30–₹100/year
- Point of Presence Fee: ₹100–₹200 per transaction
Note: Returns are indicative as of May 2025, based on past performance, and not guaranteed. Market risks apply.
Calculate Your NPS Corpus
Enter values and click Calculate Corpus to see results.
How to Invest in NPS
- Visit loanpao.in or authorized NPS points of presence (e.g., banks, post offices).
- Open a Tier I account (mandatory) and optionally a Tier II account.
- Complete KYC with PAN, Aadhaar, and bank details.
- Choose your fund manager (e.g., SBI, HDFC, LIC) and asset allocation.
- Pay via net banking, UPI, or ECS for contributions.
- Receive PRAN (Permanent Retirement Account Number) within 5–7 days.
- Contribute regularly and track via the NPS portal.
Common Questions About NPS
What is the National Pension System?
A government-backed retirement scheme for building a pension corpus through market-linked investments.
What is the difference between Tier I and Tier II?
Tier I is a mandatory pension account with restricted withdrawals; Tier II is a voluntary account with flexible withdrawals.
What are the tax benefits of NPS?
Up to ₹1.5 lakh under Section 80C and an additional ₹50,000 under Section 80CCD(1B).
Can I withdraw from NPS before retirement?
Partial withdrawals (up to 25%) are allowed after 3 years for specific needs; full withdrawal is restricted until age 60.
What happens at age 60?
You can withdraw 60% of the corpus tax-free; 40% must be used to purchase an annuity for regular pension.
Can NRIs invest in NPS?
Yes, NRIs aged 18–65 can invest, subject to KYC and bank account requirements.
Are NPS returns guaranteed?
No, returns are market-linked and vary based on fund performance.