New NPS Rule: Subscribers can now change asset allocation multiple times a year


For subscriber convenience, the National Pension Scheme or NPS has increased the number of times the plan preference or investment model of Tier 1 accounts can be changed during a financial year. Schemas can now be changed four times in a fiscal year, up from two. But the PFM or pension fund manager can be changed once per financial year.

Financial experts claim that NPS is a long-term investment product and frequent changes in diet preference could be detrimental to wealth building. The NPS allows subscribers to invest in a combination of government securities, corporate debt securities and equities, according to their preferences.

NPS or National Pension Scheme investors can change their plan preferences online or offline. The subscriber can change the scheme preferences online through logging into their NPS account by accessing the change scheme preference option. This feature is also available in the NPS application.

Alternatively, a subscriber can also submit a physical request (Form GOS-S3) to their associated nodal office. Form GOS-S3 can be downloaded for free from the CRA website. Upon receipt of the physical request, the nodal office will update the scheme preference in the CRA system.

How NPS schema switching works:

The change in regimen preference for the NPS is processed in T + 4 days. T being the authorization date.

Redemption (withdrawal of units) from the existing plan takes place in T+1.

The last available net asset value will be taken into account for the redemption of units.

At T+4, units according to the revised “plan preference” will be credited to the subscriber’s account

If the program preference change is executed after the end of the previous business day and before the start of the next business day, day T is taken into account for the redemption and the request will be settled in T + 3 business days

Meanwhile, the total number of National Pension Scheme (NPS) and Atal Pension Yojana (APY) subscribers stood at 5.33 crores as of June 4, PFRDA Chairman Supratim Bandyopadhyay said recently.

As of June 4, 2022, assets under management (AUM) under NPS and APY were 7,39,393 crore.

The number of subscribers under NPS Central Government Employee category was 22.98 lakh and AUM at 21,876 crore. The total number of subscribers in the state government employee category of NPS was 56.46 lakh and AUM at 3,69,837 crore in the period.

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