NPS – PFRDA Guidelines for Partial Withdrawal from accumulated Pension Wealth

Digital interface between CRA and POPs - PFRDA

NPS – PFRDA Guidelines for Partial Withdrawal from NPS accumulated Pension Wealth – Procedure to be followed by NPS subscribers and NPS Nodal Office when NPS subsribers apply for partial withdrawal

partial withdrawal from NPS - guidelinesThis is an important Circular as PFRDA has issued the much awaited guidelines for partial withdrawal by NPS subscribers from his/her accumulated Pension Wealth for important needs.  Though partial withdrawal was allowed in principal from NPS, there was no elaborate instructions for the same until now.   NPS subscribers who were in need of money for important purposes such as education, marriage, critical illness etc could not partially withdraw from NPS though they are entitled to same.

Now, after issue of this detailed guidelines, it is expected that NPS subscribers may be in a position to partially withdraw from NPS for important needs.

Brief of Purpose, Quantum and Frequency for partial withdrawal from NPS:


  1. Higher Education of Children
  2. Marriage of Children
  3. Construction / purchase of House / Flat
  4. Critical Illness

Quantum of Withdrawal:

25% of Amount contributed by the NPS subscriber.  Contribution by the employer not to be taken in to account

Eligibility for Partial Withdrawal:

Subscribers who have contributed in NPS for at least Ten Years are allowed to partially withdraw from NPS

Frequency of partial withdrawal:

Maximum of Three Times


B-14/A, Chhatrapati Shivaji Bhawan Qutab Institutional Area,

Katwaria Sarai, New Delhi-110016 H: 011-26517503





1. Whereas the Authority has notified the Pension Fund Regulatory and Development Authority (Exits and Withdrawals from National Pension System) Regulations, 2015 on 11th May, 2015 and is in force. Chapters III of the said regulations inter – a/ia provide the withdrawals, purpose, frequency and limits under the National Pension System (NPS).

2. Now in exercise of its powers under Section 14 read with sub-clause (b) of sub-section (2) of Section 20 of the Pension Fund Regulatory and Development Authority Act, 2013 and Regulation 7 of the aforementioned regulations, the following guidelines are issued specifying/clarifying the process to be followed by subscribers, intermediaries and concerned government nodal offices, for the purpose of effecting withdrawals from NPS, as allowed under Chapter III of the PFRDA (Exits and Withdrawals from National Pension System) Regulations, 2015

3. As per Regulation 8 of the PFRDA (Exit and withdrawal from National Pension System) Regulations 2015, the partial withdrawals shall be permitted under National Pension System (NPS).-

A partial withdrawal of accumulated pension wealth of the subscriber, not exceeding twenty-five per cent of the contributions made by the subscriber and excluding contribution made by employer, if any, at any time before exit from National Pension System subject to the terms and conditions, purpose, frequency and limits specified below:-

(A) Purpose:

A subscriber on the date of submission of the withdrawal form, shall be permitted to withdraw not exceeding twenty-five percent of the contributions made by such subscriber to his individual pension account, for any of the following purposes only:-

a) For Higher education of his or her children including a legally adopted child;

b) For the marriage of his or her children, including a legally adopted child;

c) For the purchase or construction of a residential house or flat in his or her own name or in a joint name with his or her legally wedded spouse. In case, the subscriber already owns either individually or in the joint name a residential house or flat, other than ancestral property, no withdrawal under these regulations shall be permitted;

d) for treatment of specified illnesses: if the subscriber, his legally wedded spouse, children, including a legally adopted child or dependent parents suffer from any specified illness, which shall comprise of hospitalization and treatment in respect of the following diseases:

i. Cancer;

ii. Kidney Failure (End Stage Renal Failure);

iii. Primary Pulmonary Arterial Hypertension;

iv. Multiple Sclerosis;

v. Major Organ Transplant;

vi. Coronary Artery Bypass Graft;

vii. Aorta Graft Surgery;

viii. Heart Valve Surgery;

ix. Stroke;

x. Myocardial Infarction

xi. Coma;

xii. Total blindness;

xiii. Paralysis;

xiv. Accident of serious/ life threatening nature;

xv. Any other critical illness of a life threatening nature as stipulated in the circulars, guidelines or notifications issued by the Authority from time to time.

(B) Limits:

The permitted withdrawal shall be allowed only if the following eligibility criteria and limit for availing the benefit are complied with by the subscriber:-

(a) The subscriber shall have been in the National Pension System at least for a period of last ten years from the date of his or her joining. In case the subscriber is mandatorily covered under NPS the period of ten years for partial withdrawal will be considered from the date of applicability of NPS for such subscribers. However, in case of inter-sector/intra-sector shifting of subscriber previous tenure in NPS will also be considered.

(b) The subscriber shall be permitted to withdraw accumulations not exceeding twenty-five per cent of the contributions made by him or her and standing to his or her credit in his or her individual pension account, as on the date of application for withdrawal;

(C) Frequency:

The subscriber shall be allowed to withdraw only a maximum of three times during the entire tenure of subscription under the National Pension System and not less than a period of five years shall have elapsed from the last date of each of such withdrawal. The mandatory requirement of five years having elapsed between two withdrawals shall not apply in case of “treatment for specified illnesses or in case of withdrawal arising out of exit from National Pension System due to the death of the subscriber. For subsequent withdrawal only the incremental contributions made by the subscriber after the date of first/next subsequent withdrawal as the case may be will be allowed. The request for withdrawal in the specified form shall be submitted by the subscriber, along with relevant documents to the central recordkeeping agency or the National Pension System Trust, as may be specified, for processing of such withdrawal claim. Provided that where a subscriber is suffering from any illness, specified in sub-clause (d), the request for withdrawal may be submitted, through any family member of such subscriber.

At the time of superannuation/pre-mature/death the amount withdrawn under partial withdrawal till date will be adjusted against the payment of lump sum amount and balance if any will be paid to subscriber.

(4) Partial Withdrawal process:

Partial Withdrawal request is required to be submitted by subscriber to CRA through his/her Nodal Office/POP/Aggregator, as may be applicable. The Nodal Office/POP/Aggregator should satisfy itself about the genuineness of the requirement for partial withdrawal by the subscriber and after satisfying itself forward the withdrawal application for release of funds by CRA. On receipt of Partial Withdrawal request, CRA will process the withdrawal request in the CRA system. Following are the steps which will be followed by subscriber and Nodal Office/POP/Aggregator for submitting the ‘Partial Withdrawal’ request:

Role of the Subscriber:

If the subscriber has completed 10 years under NPS, subscriber will fill up the ‘Partial Withdrawal’Form — PW — 601 and submit the same to his/her mapped Nodal Office/POP/Aggregator for processing.

2 Subscriber will provide the following details in the Form:

a Percentage of Partial Withdrawal (maximum 25%)

b. Purpose of withdrawal along with the proof

c. Bank detail along with the bank proof (cancelled cheque /copy of bank passbook/bank certificate). Before submitting the withdrawal form, subscriber shall ensure that the bank account details are correct.

3. Subscriber will affix his/her signature/Thumb impression on the Form at the designated place and submit the same to his/her mapped Nodal Office/POP/Aggregator.

Role of the Nodal Office/POP/Aggregator:

1. The concerned Nodal Office/POP/Aggregator will check the request submitted by the subscriber with respect to completeness;

2. The Nodal Office/POP/Aggregator must also verify the veracity of the claim with respect to purpose of the partial withdrawal along with supporting documents;

3. The Nodal officer/POP/Aggregator must verify the details of the bank account of subscriber;

4. If request is complete in all respect, it will authorize the request and will send the same to CRA for processing;

5. Where the claim of partial withdrawal is submitted by the authorized representative of the subscriber (in case the subscriber is unable to submit such claim) Nodal officer/POP/Aggregator must satisfy themselves about the genuineness of such claim and ensure that the bank account provided is that of the subscriber.

6. The Nodal Officer/ POP/ Aggregator should process the partial claims within three working days of receipt of the claim excepting in cases where the partial withdrawal claim has been requested because of medical reasons in which case the claim would have to be processed on the same day of receipt of the claim.

Role of CRA:

1 Once CRA receives the request, it will process the request submitted by The Nodal Office/POP/Aggregator.

2. As per stipulated process, funds will be transferred to subscriber’s bank account through electronic mode on T+3 basis. T — being the date of receipt of the verified and approved claim in CRA system.

3. Physical withdrawal request will be stored by CRA

5. These guidelines shall take effect immediately and all withdrawals shall thereafter be processed in the manner mentioned under these guidelines. Any clarification required in relation to implementation of these guidelines, for which sufficient guidance is not available, either under the regulations or these guidelines shall only be referred by the Intermediaries or the concerned nodal office to the Authority for its examination and disposal and queries of a routine nature or pertaining to internal processes of the concerned intermediary, shall be avoided. The decision of the Authority shall be final in this regard Intermediaries and Nodal offices are expected to keep the infrastructure and processes in readiness so as to give effect to these guidelines and ensure seamless facility to the subscribers.

Note: The online module for partial withdrawal in under development and is likely to go live by May 2016. Meanwhile, subscribers can request partial withdrawal through their respective Nodal Office/POP/Aggregator who should to contact CRA for processing such requests.

Download PFRDA Circular No. PFRDA/2016/7/Exit/2 dated 21.03.2016, containing the procedure for partial withdrawal from NPS