HDFC Bank National Pension Scheme (NPS) - Eligibility
Start searching for stocks
Start searching for blogs
Start searching for circulars
Start searching for news
Start searching for articles
Become a Partner
Open Demat Account
Mutual Funds Saving Schemes Equity Funds Hybrid Funds Tax FD Interest Rates Aadhaar Card Stocks Debt Funds Capital Gains RD Interest Rates Pan Card IPO See more

Introduction

The HDFC National Pension Scheme (NPS) is a retirement-oriented saving scheme regulated by the Pension Fund Regulatory and Development Authority (PFRDA). This scheme is designed to offer individuals a systematic way to accumulate savings for their retirement while also providing tax benefits. HDFC Bank, being a Point of Presence (POP), facilitates the opening and management of NPS accounts for its customers.

What is the National Pension System (NPS)?

The National Pension System (NPS) is a voluntary and long-term retirement savings scheme aimed at providing financial security during old age. It allows individuals to contribute regularly to their pension account and receive a lump sum along with a monthly pension upon retirement.

NPS is structured into two main tiers:

  • Tier I Account: A mandatory pension account with restricted withdrawals until retirement.
  • Tier II Account: A voluntary savings account with no withdrawal restrictions.

Features of HDFC Bank NPS

  1. Flexible Investment Options: Choose between Active Choice and Auto Choice.
  2. Low Cost: The expense ratio is significantly lower compared to other investment options.
  3. Tax Benefits: Contributions made to the NPS scheme offer deductions under Section 80CCD (1), 80CCD (2), and 80CCD (1B).
  4. Market-Linked Growth: Investments are managed by professional pension fund managers across different asset classes.
  5. Safe and Regulated: Monitored by PFRDA, ensuring transparency and security.

How to Open an NPS Account with HDFC Bank?

Online Investment in HDFC NPS

HDFC Bank allows customers to open an NPS account online through their official banking portal. Here’s how:

  1. Visit HDFC Bank’s NPS Portal.
  2. Select “Open NPS Account” and enter the required details.
  3. Provide Aadhaar, PAN, and other personal information.
  4. Choose between Tier I and Tier II accounts.
  5. Select the preferred fund manager and investment option.
  6. Make the first contribution to activate the account.
  7. Receive the PRAN (Permanent Retirement Account Number) for future transactions.

Offline Investment in HDFC NPS

To invest in the NPS scheme offline, follow these steps:

  1. Visit the nearest HDFC Bank branch.
  2. Collect the NPS registration form.
  3. Fill out the form and attach the necessary documents.
  4. Submit the completed form with the initial contribution.
  5. Receive the Permanent Retirement Account Number (PRAN).

You may also want to know NPS Withdrawal

Documents Required for HDFC NPS Scheme

  • Aadhaar Card (for e-KYC verification)
  • PAN Card
  • Address Proof (Utility bills, Passport, Voter ID, etc.)
  • Bank Account Details
  • Passport-size Photograph

Contribution Limits in HDFC NPS Scheme

TierMinimum ContributionMinimum Annual Contribution
Tier IRs. 500 per transactionRs. 1,000 per annum
Tier IIRs. 250 per transactionNo minimum limit

Tax Benefits of the NPS Scheme

Investors in HDFC NPS can enjoy significant tax benefits:

  1. Section 80CCD (1): Employees can claim deductions up to 10% of their salary (Basic + DA), subject to a limit of Rs. 1.5 lakh per annum.
  2. Section 80CCD (1B): Additional deduction of Rs. 50,000 per annum for voluntary contributions.
  3. Section 80CCD (2): Employer’s contribution to NPS is deductible, subject to a limit of 10% of salary (14% for government employees).

Things to Know About HDFC Bank NPS

  • The scheme is mandatory for government employees but voluntary for private-sector employees and self-employed individuals.
  • Investors can switch between fund managers if they are not satisfied with performance.
  • You can make partial withdrawals for specific purposes like education, marriage, home purchase, or medical emergencies.
  • At the time of retirement (60 years or above), subscribers must utilize at least 40% of the corpus to purchase an annuity, while the remaining 60% is tax-free.

You may also want to know BOB NPS

How to Withdraw from the HDFC NPS Scheme?

Withdrawal Rules for HDFC NPS

  1. Partial Withdrawal: Allowed after 3 years, up to 25% of self-contributed funds for specific reasons.
  2. At Retirement (60 years or above): Subscribers must use a minimum of 40% of the corpus to buy an annuity, while 60% remains tax-free.
  3. Voluntary Exit (Before 60 Years): 80% of the corpus is used to buy an annuity, while 20% can be withdrawn as a lump sum.
  4. In case of Death: The nominee receives the entire corpus without any tax deductions.

Conclusion

The HDFC National Pension Scheme (NPS) is an ideal retirement planning tool that provides a stable income post-retirement with attractive tax benefits. Whether you choose online or offline investment, it’s crucial to understand the contribution rules, withdrawal norms, and tax implications to make an informed decision. Investing in NPS through HDFC Bank ensures secure, long-term financial growth with regulated and market-linked returns.

Calculate your pension here at NPS Calculator

Frequently Asked Questions

HDFC NPS is a retirement-oriented investment scheme regulated by PFRDA, offering tax benefits and a stable pension post-retirement.

You can open an NPS account online via the HDFC Bank portal by providing Aadhaar, PAN, and making the first contribution.

Tax benefits are available under Sections 80CCD (1), 80CCD (1B), and 80CCD (2), allowing deductions of up to Rs. 2 lakh annually.

For Tier I, the minimum contribution is Rs. 500 per transaction and Rs. 1,000 annually. For Tier II, the minimum contribution is Rs. 250 per transaction.

Yes, partial withdrawals are allowed after 3 years, subject to specific conditions. Complete withdrawal is possible after 60 years.

Your NPS account remains the same, as it is linked to your PRAN and can be continued even if you change employers.

Yes, you can invest in both Tier I and Tier II accounts, but only Tier I offers tax benefits.

You can check your NPS balance online through the HDFC Bank portal or CRA (Central Recordkeeping Agency) login using your PRAN.

Explore our feature-rich web trading platform

Get the link to download the App

Download Jainam Mobile App
google play app store
trading_platform
qr-code