For National Pension System (NPS) subscribers, it is important to upload withdrawal/ KYC documents to enable parallel processing of exit and buying annuity.
Recently the pension fund regulator and insurance regulator had simplified the process of buying annuity wherein annuity service providers (ASPs) will use the NPS withdrawal form submitted at the time of exit by the subscribers.
ASPs are life insurance companies regulated by IRDAI (insurance regulator) and empanelled with PFRDA (pension fund body) to serve NPS subscribers.
In order to significantly reduce the processing time taken by ASPs, a common proposal form for exit from NPS and for buying annuity from ASP was introduced.
However, to make this happen, it is imperative for subscribers to upload all the documents with effect from April 1, 2023.
The documents are as follows:
1. NPS exit/ withdrawal form
2. Proof of identity and address as specified in the withdrawal form
3. Bank account proof
4. Copy of PRAN (Permanent Retirement Account Number) card
These are the steps that need to be followed:
Initiation of Online Exit request in CRA system by Subscriber:
1. Subscriber can log into CRA system and will start the online request for exit.
2. At the time of initiation of request, the relevant messages about e-Sign/OTP authentication, authorization of request by Nodal Office/POP etc. displayed to the Subscriber.
3. During request initiation, details like address, Bank details, nominee details etc. auto-populated from NPS account.
4. At this stage, subscriber will select fund allocation percentage for lump sum/annuity, annuity details, etc.
5. Then subscriber’s bank account registered in CRA will be verified through online Bank Account Verification (Penny drop facility).
6. It is vital for subscriber to mandatorily upload KYC documents (identity and address proof), copy of PRAN card/ e-PRAN and Bank Proof at the time of submitting exit request.
7. Needless to say that the scanned documents should be appropriate i.e., scanned images should be legible.
8. Subscriber authorizes the request by using any one of the two following options to make the process paperless:
A. OTP authentication: Distinct OTPs are sent on mobile number and email ID of subscribers.
B. e-Sign: Subscribers will e-Sign the request using Aadhaar.