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New Delhi [India], April 27 (/ATK): In February 2023, the Pension Fund Regulatory and Development Authority (PFRDA) issued a circular, mandating NPS subscribers to upload a few documents effective from April 1st, 2023. The pension body mentioned that uploading these documents would ensure timely annuity income payments.PFRDA currently administers and regulates the National Pension System (NPS), which provides a steady income stream to subscribers after their retirement. Furthermore, NPS withdrawal entails a systematic process.Under the existing rules, at the time of maturity, you must use a portion of the accumulated corpus - 40% to be exact - to purchase an annuity plan from an Annuity Service Provider (ASP). ASPs are approved by PFRDA, and offer numerous annuity options to provide a steady stream of income throughout your retirement years. The remaining 60% of the corpus can be withdrawn as a lump sum if it is less than or equal to Rs5 Lakhs.Exiting from Government and Corporate NPS SchemesTo exit from government and Corporate NPS schemes, you can withdraw from the respective pension schemes before reaching retirement age. In the case of government NPS, government employees can exit once they reach the age of 60 years or earlier by fulfilling certain conditions. In the case of corporate NPS, the employees can exit upon turning 60 or earlier, as per the applicable exit policy.Role of Annuity Service ProvidersUnder the National Pension System (NPS), Annuity Service Providers, such as LIC and SBI Life Insurance, play a crucial role. Once you reach retirement age or want to withdraw from NPS, a part of the accumulated corpus is used to buy an annuity from an Annuity Service Provider. These ASPs offer different annuity options, such as annuity for life, and annuity for life with return of purchase price on death.These schemes ensure that you receive a regular income stream during your retirement years, based on the annuity option you choose, offering financial security and stability. Under the current rules, if you want to buy a pension plan for early retirement before turning 60, you must utilise 80% of the accumulated corpus to buy an annuity. Moreover, these ASPs use the NPS withdrawal forms subscribers provide at the time of exit at nodal officers or POPs to issue an annuity.Documents to be Uploaded for Quick Distribution of Annuity IncomeAs per the PFRDA's circular, certain withdrawal and KYC documents need to be uploaded for the parallel processing of exit and annuity. This significantly reduces the time taken by ASPs to issue annuity policies. Furthermore, it enables faster subscriber servicing, and you can get the lump-sum amount quickly.The documents you need to upload include:* NPS Withdrawal/Exit form* Identity and address proof, as mentioned in the Withdrawal form* Proof of your bank account* PRAN Card copySteps Included in the Processing of NPS Withdrawl or Exit RequestWhether you've opted for the government NPS scheme or a corporate NPS scheme, you must follow these steps to exit from NPS.Step 1: You must log into the CRA system to initiate the online exit request.Step 2: Once you initiate the request, you will see relevant notifications about e-Sign/OTP authentication, Nodal Office/POP authorisation, etc.Step 3: After you initiate the request from the NPS account, details such as your bank information, address, nominee details, etc. are auto-populated in the NPS withdrawal form.Step 4: You can choose the fund allocation percentage for annuity and withdrawable corpus, annuity details, etc.Step 5: Using the penny drop verification, your bank account will be verified online.Step 6: While submitting the exit request, you must upload KYC documents (identity and address proof), PRAN Card/ePRAN copy, and bank proof.Step 7: All scanned documents must be legible.Step 8: You can authorise the request using one of the following two options:- OTP Authentication - Different OTPs will be forwarded to your phone number and email ID.- e-Sign - You can e-Sign the request using your Aadhaar Card.ConclusionTo exit from the National Pension System (NPS), you can withdraw from the pension scheme before or after reaching the retirement age of 60. Upon exit, you must utilise 40% of the accumulated amount to purchase an annuity from an Annuity Service Provider (ASP). The remaining amount can be withdrawn as a lump sum if it is less than Rs5 Lakhs.As per PFRDA's latest circular, you can ensure quick distribution of annuity income by uploading a few documents w.e.f from 1st April 2023. These documents include the NPS withdrawal/exit form, identity and address proof, proof of your bank account, and your PAN Card copy.This story has been provided by ATK. will not be responsible in any way for the content of this article. (/ATK)Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

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