Mumbai: In a significant development concerning the National Pension System (NPS), the Pension Fund Regulatory and Development Authority (PFRDA) has announced a major change that will come into effect from April 1. Under the new rule, Aadhaar card verification will be mandatory for account withdrawals.
The decision, outlined in a recent circular issued by PFRDA, aims to enhance the security and integrity of the NPS framework. By making Aadhaar verification compulsory for withdrawals, the regulatory body seeks to bolster the authentication process and mitigate potential risks associated with account access.
Currently, NPS members utilize a user ID and password to access their accounts, facilitating transactions and withdrawals. However, with the upcoming regulation, this system will undergo a crucial transformation. Nodal officers of central and state governments, who oversee account management, will transition from the existing password-based authentication to Aadhaar-based verification.
According to PFRDA, Aadhaar-based log-in verification will be intricately linked to the unique identification of NPS members. Upon implementation, accessing the NPS account will necessitate entering a One Time Password (OTP) received on the Aadhaar-linked mobile number, thereby adding an extra layer of security to the process.
The decision underscores PFRDA's commitment to safeguarding the interests of NPS members while ensuring the reliability and resilience of the Central Record Keeping Agency (CRA) system.
Withdrawal Eligibility in NPS:
- The National Pension System offers flexibility in withdrawals under various circumstances:
- Home Purchase: NPS funds can be withdrawn for purchasing a house.
- Education and Marriage Expenses: Funds can be utilized for children's education or marriage.
- Medical Emergencies: Withdrawals are permissible in the event of medical emergencies.
- Entrepreneurial Ventures: Individuals can withdraw funds to initiate a new business or startup.
- Skill Development: NPS allows withdrawals for expenses related to skill development.
- Accident Coverage: Funds can be accessed in case of accidents.
As the new rule comes into effect, NPS members are advised to ensure their Aadhaar details are accurately linked to their accounts to facilitate seamless transactions and withdrawals.
The implementation of Aadhaar verification reflects a proactive approach by PFRDA to enhance the security measures within the NPS ecosystem, ultimately fostering greater confidence among stakeholders.