NPS Vatsalya Scheme for Minors: People are very excited about the NPS Vatsalya scheme launched for children. NPS Vatsalya scheme is a pension scheme introduced by the central government which is for children below 18 years of age. NPS Vatsalya scheme was launched on Wednesday, 18 September. According to the report, NPS Vatsalya accounts were opened in the name of 9,705 children on the day of launch.
These accounts are under NPS Vatsalya Yojana Registered with PFRDAOpenings were made through various Points of Presence (POPs) such as major banks, post offices and e-NPS portal. Of the accounts opened on September 18, 2197 accounts were through the e-NPS portal alone. During the scheme launch, Finance Minister Nirmala Sitharaman described the NPS Vatsalya scheme as an important step in the government’s effort to promote long-term financial planning and security for all people. She said that apart from securing the financial future of children, NPS Vatsalya is based on the intergeneration equity principle by providing cover to old and young members of the family. It is expected that the NPS Vatsalya scheme will promote the habit of saving in children and can help in building a large corpus through compounding.
On the lines of NPS, NPS Vatsalya Yojana has been introduced for children below 18 years of age and is available for all income groups. The minimum contribution for this scheme is Rs 1,000 per year and pension will be available after the age of 60 years. Any parent or guardian can open an NPS account in the name of their minor child with a minimum of Rs 1,000. There is no maximum limit in this scheme.
NPS Vatsalya account can be opened in the name of a minor child and can be operated by the parent or guardian. The scheme Registered with PFRDAIt can be opened through various points of presence such as major banks, post offices, pension funds and online platforms (e-NPS). 25% of the deposit in the NPS Vatsalya account can be withdrawn when the child turns 18 years old. When the child becomes an adult, the NPS Vatsalya account will be converted into a regular NPS account.
PFRDA will provide various investment options to the subscribers of NPS Vatsalya Scheme. Subscribers will be able to choose to invest in government securities, corporate debt and equity in different proportions depending on their risk appetite and desired returns.
