The Pension Fund Regulatory and Development Authority (PFRDA) has issued a new Master Circular detailing the service charges that can be collected by Points of Presence (PoPs) under the National Pension System (NPS) for all citizens and corporate entities, as well as the NPS-Lite framework.
The circular, updated as of January 31, 2025, consolidates previous instructions and outlines the updated charge structure, effective from January 31, 2025.
Key Highlights of the Master Circular:
Objective of the Circular: The circular aims to incentivize PoPs to effectively promote and distribute NPS while enhancing customer service. It consolidates various earlier circulars related to service charges for PoPs under NPS (All Citizen and Corporate) and NPS-Lite.
Service Charges for NPS:
- Initial Subscriber Registration: PoPs can charge up to ₹400 as an upfront fee.
- Initial Contribution: A fee of up to 0.50% of the contribution, with a maximum limit of ₹25,000.
- Subsequent Contributions: Fees are capped at ₹30 per transaction.
- Non-Financial Transactions: PoPs can charge up to ₹30 for any non-financial transaction.
- Persistency Charge: For subscribers staying with the same PoP for more than 6 months in a financial year, persistency charges apply, with amounts ranging from ₹50 to ₹100 depending on the contribution level.
- e-NPS (for Subsequent Contributions): Charges up to 0.20% of the contribution, subject to a maximum of ₹10,000.
- Processing of Exit/Withdrawal: A fee of up to 0.125% of the corpus, capped at ₹500.
- Trail Commission for DRemit Contributions: A fee of up to 0.20% of the contribution, subject to a maximum of ₹10,000.
Service Charges for NPS-Lite/Swavalamban: For transactions under NPS-Lite/Swavalamban:
- Subsequent Transactions: Charges are 0.25% of the total contribution deposited, with a minimum fee of ₹20.
- Other Transactions: A fee of ₹10 per transaction.
Persistency Charges: Persistency charges are applicable when a subscriber remains associated with the same PoP for more than six months in a financial year. These charges will be calculated and deducted based on the contribution level, as per the updated structure.
Compliance and Transparency:
- PoPs are required to disclose their charges transparently to subscribers, both during transactions and on their websites.
- Any violation of the charge structure will lead to action by the PFRDA under the PFRDA Act, 2013 and related regulations.
GST and Other Taxes: Applicable GST or other taxes will be additional to the mentioned charges.
Transition and Rescission of Older Circulars:
This Master Circular consolidates the service charge structure from earlier circulars, which are now rescinded but remain valid for the period they were in force. A list of rescinded and archived circulars is provided in Annexure II of the Master Circular.
Additionally, the circular includes an updated charge structure that will apply from January 31, 2025, with earlier charge structures available for reference.
Specific Guidelines:
- Negotiation of Charges: PoPs retain the option to negotiate charges with subscribers, but the charges should not exceed the limits set by PFRDA.
- Display of Charges: All PoPs are required to make their charge structures available publicly on their websites and inform subscribers during transactions via pop-up notifications.
In summary, the PFRDA Master Circular aims to streamline the service charge structure for NPS and NPS-Lite services, ensuring transparency and uniformity across the system while incentivizing Points of Presence to better serve and engage with NPS subscribers.
For a comprehensive list of earlier circulars and their rescinded versions, please refer to Annexure I and Annexure II in the official Master Circular document.
