Points of Purchase Can Process NPS Withdrawals Till 30 June

In 2020, POPs could acknowledge scanned and self-certified exit document images via digital means for processing the NPS subscriber withdrawal requests. Nevertheless, POPs had to submit the physical withdrawal applications to the respective Central Record Keeping Agency (CRA) for record-keeping and storage purposes.

The Pension Fund Regulatory and Development Authority (PFRDA) permits Points of Purchase (POPs) to accept exit/withdrawal NPS applications via soft copies. Nevertheless, they will be responsible for complying with the regulations concerning processing exits.

The beneficiary bank details must be verified and matched as part of additional due diligence before processing an NPS withdrawal request based on a soft copy. Going forward, all such records need to be mandatorily transmitted to CRA via soft copies.

POPs would be held responsible in case any dispute arises out of such transactions in future. The pension regulator has undertaken this decision given the COVID-19 pandemic.

With the onset of the COVID-19 pandemic, subscribers faced problems submitting the physical NPS exit/withdrawal applications. On the other hand, POPs faced logistical challenges in collating the applications for processing and dispatching the same to CRA. In the interest of subscribers, PFRDA decides to relax the process of handling the withdrawal applications by POPs.

PFRDA has mentioned that the relaxation to POPs will be allowed till 30th June. An ‘online paperless exit process’ based on an OTP or e-sign is anticipated to be introduced by CRA to benefit subscribers. 

Starting 1st July, POPs must be ready and equipped to process the subscriber exit requests by authorising the uploaded exit documents by a subscriber in the CRA system. The guidelines to execute this process have already been issued.

For any clarifications/feedback on the topic, please contact the writer at bhavana.pn@cleartax.in

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