Big improvement in pension scheme: New rules of NPS come into effect from July 1

New Delhi. A big step has been taken towards making the pension system more transparent and easier for crores of investors in the country. The Pension Fund Regulatory and Development Authority (PFRDA) has further clarified the rules regarding charges under the National Pension System (NPS). These changes will come into effect from July 1, 2026. The special thing is that this is not a completely new system, rather the already implemented provisions have been made more organized and understandable.

Charge structure becomes easier and clearer

Under the new provisions, clarity has been given regarding the charges for Tier I and Tier II accounts. Now the Annual Maintenance Charge (AMC) on Tier II account will be equal to Tier I. However, AMC will not be charged on accounts where the balance at the end of a quarter is ₹1,000 or less. This is expected to provide relief to small investors.

Each account will be treated separately

Different accounts (Tier I and Tier II) under the same PRAN number will now be treated as independent accounts. This means that different AMC will be applicable on each account. With this, investors will be able to get a clear account of their investments and expenses.

New rule for inactive accounts

If no contribution is made to an account for four consecutive quarters, it will be considered inactive. In such cases only 10% AMC will be charged, which will not put additional burden on investors. As soon as the account is reinvested, it will be reactivated from the next quarter. Also, the concerned agencies have been given the responsibility to identify and tag such accounts.

Big relief to zero balance accounts

No AMC will be charged on NPS Lite or other zero balance accounts. This step has been taken especially keeping in mind small and limited income investors, so that they can remain connected to the pension scheme without any additional charges.

Charge recovery method decided

The process of taking charges has also been clarified now. This will be collected either through bill through the employer or by deducting units from the investor’s account. This will make the process more transparent and streamlined.