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The National Pension System, or NPS is a retirement and social security plan introduced by the Government of India in 2004. Though initially introduced for government employees only, it was made accessible to all Indian citizens in May 2009. With the NPS, money invested is pooled together to form an investment fund. This investment fund is then reinvested by professional fund managers who are vetted by the Pension Fund Regulatory and Development Authority. Investments are done in the equity market in a diversified portfolio that comprises government bonds, bills, corporate shares and debentures. You can decide how much of your investment goes in to equities, but it is capped at a maximum of 75%, making the NPS a relatively safer investment plan, and suitable for building a stable retirement corpus.
On retirement, you are allowed to withdraw 60% of the corpus as a lump sum, which is non-taxable. The remaining 40% is used to purchase annuities which provide you a monthly return as pension. Since the government has made the NPS available for all citizens of the country, there is now a need to provide everyone with a method that can be used when people want to operate, change or track their NPS accounts. This is where Points of Presence, or PoPs, come into play.
What are PoPs?
Points of Presence, or PoPs, are service providers present all across the country to ensure that you are able to operate your NPS account smoothly without any hindrance. PoPs are also appointed by the PFRDA, forming a network of branches, which are known as PoP Service Providers (PoP SP). Apart from providing you with facilities like opening a Permanent Retirement account, and being able to contribute to your NPS fund, PoPs also serve a plethora of other purposes.
What are the functions of PoPs?
The primary function of a PoP, or a PoP SP, is to enable you to register a Tier I or a Tier II account, as per your convenience. A PoP is responsible for accepting your duly filed Composite Subscriber Registration Form (CSRF) and verifying the form for your date of birth, bank, details of the scheme and the nominations. The PoP also serves the purpose of verifying your customer documents as per existing, prescribed norms.
A PoP is also responsible for collecting your NPS Contribution Instruction Slip (NCIS) along with your application form, ensuring that mandatory and relevant details are given by you in your NCIS. They also remit the funds, after deducting their charges and taxes, to the Trustee Bank within one banking day from the date of your application.
While you submit your NCIS, the PoP shall also perform the due diligence of checking your Permanent Retirement Account Number (PRAN), along with your payment details and other documents. Your contribution details are then uploaded to the Central Recordkeeping Agency system bank in correspondence to your PRAN.
A Point of Presence also serves the purpose of changing your personal details as per your requirement, within one banking day of your application. You can also change your investment scheme or your fund manager, through your PoP, if you are not happy with the performance of your fund. In case you are unhappy with the overall performance of your NPS account and choose to withdraw your account, the PoP will facilitate it on the same day, provided your application is processed within banking hours. In case your application is processed after banking hours, the same is processed the next banking day. Your PoP SP is also responsible for changing your location and issuing prints of your account statement, as and when needed. In case you lose your PRAN card, you can also apply for another one from your PoP.
In case you have any grievances pertaining to your National Pension System account, you can submit them to your respective PoP, which would then receive and upload the same on the Central Grievance Management System (CGMS) of the CRA.
In short, all services that are prescribed by the PFRDA are provided by the PoPs or the PoP SPs.
How do you know your PoP?
In case you have difficulties locating a Point of Presence close to you, you can check your transaction statement, if you have one, and it should have your PoP listed. You can also locate your closest PoP by clicking here https://nps.kfintech.com/index/allcitizens/ If you are looking for a suitable solution to a stable retirement plan, you can choose to go with NPS with KFintech CRA, by clicking here nps.kfintech.com
