Key amendments in PFRDA (Exits and Withdrawals under the NPS) Regulations, 2015

PRESS RELEASE Key amendments in PFRDA (Exits and Withdrawals under the NPS) Regulations, 2015 New Delhi, 19 December, 2025 - In furtherance of its mandate to promote old-age income security and protect the interests of subscribers, the Pension Fund Regulatory and Development Authority (PFRDA) has notified amendments to the PFRDA (Exits and Withdrawals under the National Pension System) Regulations, 2015.

The amendments are primarily aimed at the non-government sector (All Citizen Model and Corporate Sector), applicable uniformly to both Common Schemes and the Multiple Scheme Framework (MSF), while also rationalizing certain provisions for the government sector. Finalized after extensive stakeholder consultations, these measures aim to provide subscribers greater flexibility, choice, and autonomy in investment decisions and managing their accumulated pension wealth, recognizing that non-government NPS participation is voluntary. Clear and well-structured exit provisions are expected to encourage entry and sustain participation by balancing subscriber needs and pension objectives across different stages of their life cycle.

Overall, the amendments reflect evolving subscriber needs and seeks to make the NPS more inclusive, responsive, and subscriber-friendly, while safeguarding long-term retirement income security. The key areas

that have been revised are outlined below in a comparative tabular format:

Sl. Earlier stipulation Revised stipulation I. Non-Government Sector (All Citizen Model and Corporate Sector) Changes applicable uniformly to Common Schemes (CS) & Multiple Scheme Framework (MSF) Lock-in period 1 All Citizen Model: All Citizen Model (CS & MSF):

Minimum lock-in period to be Minimum lock-in period removed eligible for premature exit → 5 years Normal Exit 2 All Citizen Model: All Citizen Model (CS & MSF):

Vesting period → Till 60 years of Vesting period → 15 years or till 60 years of age (whichever is age to be eligible for normal exit earlier).

3 Corporate Sector: Corporate Sector (CS and MSF):

Vesting period → Till age of Vesting period → Till age of retirement / superannuation retirement / superannuation (Remains same)Sl. Earlier stipulation Revised stipulation 4 All Citizen Model & Corporate All Citizen Model & Corporate Sector (CS & MSF):

Sector: Up to 80% lumpsum;

Up to 60% lumpsum; At least 20% annuity At least 40% annuity 5 All Citizen Model & Corporate All Citizen Model & Corporate Sector (CS & MSF):

Sector: a) Corpus ≤ ₹8 lakh:

For corpus ≤ ₹5 lakh → 100% 100% lumpsum or SLW or SUR lumpsum (or) Up to 80% lumpsum & At least 20% annuity b) Corpus > ₹8 lakh ≤ ₹12 lakh:

Up to ₹6 lakh as lumpsum and balance as SUR for min. 6 years or annuity.

(or) Up to 80% lumpsum & At least 20% annuity c) Corpus > ₹12 lakh:

Up to 80% lumpsum & At least 20% annuity Premature Exit 6 All Citizen Model & Corporate All Citizen Model & Corporate Sector (CS & MSF):

Sector: Up to 20% lumpsum;

Up to 20% lumpsum; At least 80% annuity (Remains same) At least 80% annuity 7 All Citizen Model & Corporate All Citizen Model & Corporate Sector (CS & MSF):

Sector: a) Corpus ≤ ₹5 lakh:

For corpus ≤ ₹2.5 lakh → 100% 100% lumpsum or SLW or SUR lumpsum (or) Up to 20% lumpsum & At least 80% annuity b) Corpus > ₹5 lakh:

Up to 20% lumpsum & At least 80% annuity Exit due to Death 8 All Citizen Model & Corporate All Citizen Model & Corporate Sector (CS & MSF):

Sector: 100% lumpsum; Option for annuity, if desired.

100% lumpsum; Option for annuity, (Remains same) if desired. Additionally, option for availing SLW or SUR.Sl. Earlier stipulation Revised stipulation II. Individuals joining NPS after age of 60 years (All Citizen Model) Normal Exit 9 Vesting period → 3 years to be Vesting period removed eligible for normal exit 10 Up to 60% lumpsum; Up to 80% lumpsum;

At least 40% annuity At least 20% annuity 11 For corpus ≤ ₹5 lakh → 100% a) Corpus ≤ ₹12 lakh: lumpsum 100% lumpsum or SLW or SUR.

(or) Up to 80% lumpsum & At least 20% annuity b) Corpus > ₹12 lakh:

Up to 80% lumpsum & At least 20% annuity Premature Exit 12 Up to 20% lumpsum; Not applicable as the vesting period has been removed At least 80% annuity Exit due to Death 13 100% lumpsum permitted; Option 100% lumpsum permitted; Option for annuity, if desired.

for annuity, if desired. (Remains same) Additionally, option for availing SLW or SUR.

III. Government Sector Normal Exit 14 Up to 60% lumpsum; Up to 60% lumpsum;

At least 40% annuity At least 40% annuity; (Remains same) 15 For corpus ≤ ₹5 lakh → 100% a) Corpus ≤ ₹8 lakh: lumpsum 100% lumpsum or SLW or SUR

(or) Up to 60% lumpsum & At least 40% annuity b) Corpus > ₹8 lakh ≤ ₹12 lakh:

Up to ₹6 lakh as lumpsum and balance as SUR for min. 6 years or annuity.

(or) Up to 60% lumpsum & At least 40% annuity c) Corpus > ₹12 lakh:

Up to 60% lumpsum & At least 40% annuitySl. Earlier stipulation Revised stipulation Premature Exit 16 Up to 20% lumpsum; Up to 20% lumpsum;

At least 80% annuity At least 80% annuity; (Remains same) 17 For corpus ≤ ₹2.5 lakh → 100% a) Corpus ≤ ₹5 lakh: lumpsum 100% lumpsum or SLW or SUR

(or) Up to 20% lumpsum & At least 80% annuity b) Corpus > ₹5 lakh:

Up to 20% lumpsum & At least 80% annuity Exit due to Death 18 Up to 20% lumpsum; Up to 20% lumpsum;

At least 80% annuity At least 80% annuity; (Remains same) 19 For corpus ≤ ₹5 lakh → 100% a) Corpus ≤ ₹8 lakh: lumpsum 100% lumpsum or SLW or SUR

(or) Up to 20% lumpsum & At least 80% annuity b) Corpus > ₹8 lakh ≤ ₹12 lakh:

Up to ₹6 lakh as lumpsum and balance as SUR for min. 6 years or annuity.

(or) Up to 20% lumpsum & At least 80% annuity c) Corpus > ₹12 lakh:

Up to 20% lumpsum & At least 80% annuity IV. Other changes Entry and Exit Age 20 Maximum entry age up to 70 years; Entry and exit age increased to 85 years. exit age up to 75 years.

Automatic continuation 21 Subscriber to intimate 15 days prior 15-day prior intimation requirement removed across sectors, to 60 / superannuation for hence subscribers can automatically continue under NPS.

continuation (Govt) or deferment of annuity and/or lumpsum (Govt & Non-Govt).

Specific Purpose Scheme 22 - a) New regulation enabling exit/withdrawal provisions for ‘specific purpose schemes’ under NPS.Sl. Earlier stipulation Revised stipulation b) To be governed by Guidelines issued by the Authority for each such scheme.

Financial assistance against pension corpus 23 Assignment or pledge of NPS a) Subscriber can seek financial assistance from a regulated benefits void except where permitted financial institution and the lender may mark lien or charge by NPS Trust. on the individual pension account up to 25% of subscriber’s own contribution (i.e. within partial withdrawal limits).

b) To be governed by Guidelines issued by the Authority.

Frequency of Partial Withdrawal 24 During the tenure of subscription i) Before 60 years age / superannuation (whichever is later): (i.e. before exit) → a) Frequency: 4 times a) Frequency: 3 times. b) Interval: 4 years between two withdrawals b) Interval not stipulated between two withdrawals ii) Post 60 years age / superannuation (whichever is later):

a) Frequency: NA b) Interval: 3 years between two withdrawals Purpose of Partial Withdrawal 25 Purchase or construction of a No change, but additionally clarified it as a one-time residential house permitted if withdrawal.

subscriber does not already own a house (other than ancestral property).

Treatment of specified illness limited Broadened to medical treatment/hospitalization without a to a comprehensive list of specified specified list (for subscriber/spouse/children/parents). critical illnesses (for subscriber / spouse / children / parents).

Skill development, re-skilling, self- Removed development activities (for subscriber).

Establishing a start-up or own Removed venture (for subscriber).

New purpose New purpose added: Settlement of a financial obligation of the subscriber taken from a regulated financial institution against lien/charge on NPS account.

V. NPS-Lite Normal Exit 26 Up to 60% lumpsum; Up to 60% lumpsum;Sl. Earlier stipulation Revised stipulation At least 40% annuity At least 40% annuity; (Remains same) 27 For corpus ≤ ₹1 lakh → 100% a) Corpus ≤ ₹2 lakh:

lumpsum 100% lumpsum (or) Up to 60% lumpsum & At least 40% annuity b) Corpus > ₹2 lakh:

Up to 60% lumpsum & At least 40% annuity Premature Exit 28 Up to 20% lumpsum; Up to 20% lumpsum;

At least 80% annuity At least 80% annuity; (Remains same) 29 For corpus ≤ ₹1 lakh → 100% a) Corpus ≤ ₹2 lakh: lumpsum 100% lumpsum (or) Up to 20% lumpsum & At least 80% annuity b) Corpus > ₹2 lakh:

Up to 20% lumpsum & At least 80% annuity Exit due to Death 30 100% lumpsum permitted; Option 100% lumpsum permitted; Option for annuity, if desired. for annuity, if desired. (Remains same) Note 1:

1. Normal Exit → Exit upon, i) Completing 15 years of subscription or 60 years of age (whichever is earlier) (All citizen model); ii) Superannuation / retirement (Government and Corporate Sector)

2. Vesting period → Period of subscription required to become eligible for Normal Exit

3. Premature Exit → Exit prior to completion of vesting period

4. Lock-in period → Period of subscription required to become eligible for Premature Exit

5. SLW → Systematic Lumpsum Withdrawal

6. SUR → Systematic Unit Withdrawal Note 2:

The changes tabulated above are some of the broad key amendments (indicative but not exhaustive) effected in the Exit Regulations. For complete detailed changes, PFRDA (Exits and withdrawals under the NPS)

(Amendment) Regulations, 2025 may be referred @ https://www.pfrda.org.in/