About Scheme

The NPS Vatsalya Scheme was announced by the Finance Minister in the Union Budget 2024–25. It allows parents or guardians to open a National Pension System (NPS) account for their minor children, contributing until they turn 18 years old. Upon attaining majority, the account seamlessly converts into a regular NPS Tier-I account.

Details

Under NPS Vatsalya, parents or guardians can invest on behalf of their children with a minimum annual contribution of ₹1,000 and no upper limit. The scheme offers multiple investment options, including lifecycle and active fund management choices. Upon reaching 18 years, the minor’s account automatically transitions into a regular NPS Tier-I account after fresh KYC verification.

Key Features

• Encourage long-term retirement savings from an early age
• Promote financial discipline and awareness
• Enable parents to secure their child’s financial future through NPS

Eligibility

Any Indian minor (below 18 years) is eligible to open an account under the NPS Vatsalya Scheme. The account must be opened by a natural or legal guardian who operates it for the benefit of the minor. Court-appointed guardians must submit relevant legal documents confirming guardianship. The guardian must fulfill KYC norms as per PFRDA requirements.

Benefits

Opening an NPS Vatsalya account gives a child an early start in retirement savings and teaches financial discipline. Upon attaining 18 years, the account converts into a standard NPS Tier-I account without disruption. Guardians may also make partial withdrawals (up to 25%) after 3 years for education, medical treatment, or disability-related expenses, up to three times before the child turns 18.

Application Process

Online: Visit https://npstrust.org.in/open-nps-vatsalya and click on “Open NPS Vatsalya.” Select a CRA, fill in details of the minor and guardian, complete OTP-based authentication, upload minor’s date of birth proof, choose investment options, and make an initial contribution (minimum ₹1,000). The PRAN (Permanent Retirement Account Number) will be generated upon successful payment. Offline: Visit an NPS Point of Presence (POP) with KYC documents of the guardian and proof of minor’s age to open an account.

Documents Required

1. Aadhaar Card / PAN Card / Driving License of Guardian 2. Proof of Date of Birth of Minor (Birth Certificate, School Certificate, Passport, etc.) 3. Guardian’s Signature 4. Passport Copy (for NRIs only) 5. Foreign Address Proof (for OCI subscribers) 6. Bank Proof (for NRI/OCI subscribers)