Procedure To Open An NPS Account Using Aadhaar Card

The National Pension Scheme is a common method for individuals to create a substantial corpus for their post-retirement lives. Generally, individuals relied on their PAN to open such an account. That said, you can also use your Aadhaar card to open an NPS account. This article discusses the various procedures for doing so. Before learning about the various steps, you must know more about the National Pension Scheme in general.

What is NPS?

NPS is a long-term investment option that provides a regular stream of income post-retirement. The Central Government, in association with the Pension Fund Regulatory and Development Authority (PFRDA), manages this specialised scheme. Employees belonging to the private, public and unorganised sectors are eligible to invest in NPS.

Previously, the procedure for the NPS account application was cumbersome. Individuals had two options when trying to initiate such an investment. They could visit the nearest bank branch, fill up a PRAN form and submit it there. 

Alternatively, one could download the PRAN form from the internet and fill it up. Following this, he/she would need to take a printout and send the completed form, along with signature and photographs, to the Central Recordkeeping Agency.

However, after a recent directive by the PFRDA, you can now open an NPS account through an online process only. The Aadhaar card is mandatory to complete eKYC for this online application.

Also read: How To Link PAN With Aadhaar Via The New Income Tax Portal?

Steps to Apply for NPS Account Online Using Aadhaar eKYC

If you want to create an NPS account online, you would need to complete the following procedure: 

Step 1

This process starts when you navigate to the official eNPS portal. Find the ‘Registration’ option and click on it.

Step 2

Choose whether you are a ‘Corporate Subscriber’ or an ‘Individual Subscriber.’

Step 3

Depending on your current residential status, choose one of the three options — Indian citizen, Non-resident Indian, or Overseas Citizen of India.

Step 4

Proceed to select the ‘Aadhaar Online/Offline KYC’ option, and choose either Tier I or Tier II account. By default, all NPS account holders have a Tier I account.

Step 5

Next, enter your Aadhaar number and the 16-digit Virtual ID in the relevant fields. After entering these two numbers, click on generate OTP. 

Step 6

An OTP should arrive shortly on your Aadhaar-linked phone number. Enter the received OTP in the correct space and hit continue.

Step 7

After successful OTP verification, the online PRAN form will appear with details, such as date of birth, full name, gender and residential address already filled up. You would still need to provide other relevant information during this stage of the application.

Step 8

Make an initial contribution to the account to validate your National Pension Scheme account.

Step 9

The last step involves a digital authentication procedure which you can complete using an Aadhaar-based e-signature. 

Steps to Link Aadhaar to Your Existing NPS Account

When you already have an NPS account, it is a wise idea to link the same with your Aadhaar. This can lead to increased convenience in the future. Here’s how you can go about it: 

Step 1

Visit the official NSDL CRA website and use your NPS information to log in to your account.

Step 2

After logging in, select the ‘Update Aadhaar/Address Details’ option. You can find this under the ‘Update’ tab.

Step 3

Enter your Aadhaar number and choose the relevant option to generate OTP. Click on proceed.

Step 4

After receiving the OTP on your Aadhaar-linked phone number, proceed to enter the same in the correct field. 

Doing so will link your NPS account with your Aadhaar immediately.  

Important Points to Remember When Linking Aadhaar with NPS Account

Keep the following pointers in mind when you are about to link your NPS account with your Aadhaar:

• The name on your Aadhaar and the Permanent Retirement Account Number should be identical. If the spelling is different or there are some other inconsistencies, the linking is not possible.
• Even if an NPS account holder provides his/her Aadhaar information during account opening, he/she must still proceed with Aadhaar-NPS linking.
• OTP authentication is the only method through which verification of Aadhaar can take place during such a linking.
• In the case of government employees, one can consider Aadhaar seeding complete only after the Nodal officer sanctions the application.   

Why Should You Link Aadhaar and NPS?

Here are some advantages of Aadhaar-NPS linking: 

1. The authentication process with Aadhaar is simpler and less time-consuming. You do not need to take a printout of the PRAN form to provide a specimen of your signature. Instead, the Aadhaar-based e-signature fulfils this requirement.
2. Aadhaar seeding leads to instantaneous fulfilment of KYC norms. Thus, a subscriber does not need to wait for NPS processing.
3. Linking Aadhaar with NPS also allows for easier tracking of transactions by the government. For the subscriber, this means effectively claiming tax benefits. 
4. Lastly, you can avoid considerable paperwork when authenticating your NPS account using Aadhaar. Once again, this minimises hassle and encourages more individuals to subscribe to the scheme.  

Nevertheless, even after the introduction of this online authentication method, some potential NPS account holders prefer the offline application process.

Steps to Apply for an NPS Account Offline

To open an NPS account offline, you would need to visit a PoP entity. PoP stands for point of presence, and it refers to banks that have the authority to generate PRAN. The PFRDA has authorised such banks to open NPS accounts. Here is the detailed offline procedure to open such an account:

Step 1

Visit any PoP entity and ask for a PRAN form.

Step 2

After filling up this application form, submit the same. Substantiate your application by submitting relevant documents too.

Step 3

Pay the registration fee at the bank branch after the submission of your form.

After a few days, you should receive the PRAN card through the post at your residential address. As you can see, this offline process can be cumbersome and time-consuming. It requires you to visit the bank branch and wait for PRAN authentication. The online process eliminates much of this hassle.

Also read: How To Check PAN And Aadhaar Linking Status?

Final Word

The decision to open an NPS account can lead to financial well-being after retirement. With Aadhaar becoming the primary identification document, linking it to your NPS account is a smart move. Apart from the accelerated authentication, Aadhaar can also help you to claim savings when your investment matures.    

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