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The Pension Fund and Regulatory Authority of India (PFRDA) has introduced the NPS Vatsalya Scheme, a child-focused pension savings plan that helps parents build a financial cushion for their children’s future. This long-term investment plan ensures that once the child turns 18, the accumulated funds can be used for education, higher studies, or any other essential purpose.
Let’s dive into the benefits, eligibility, and process of opening an NPS Vatsalya account to help you secure your child’s financial future.
What is the NPS Vatsalya Scheme?
The National Pension System (NPS) Vatsalya Scheme allows parents to systematically invest and save for their children until they turn 18 years old.
Key Features of NPS Vatsalya:
Minimum investment – ₹1,000 per month
No upper limit on investment – Invest as much as you want
Guaranteed financial security – Funds can be used for education or future needs
Regulated by PFRDA – Ensures safety and transparency
Long-term disciplined saving – Encourages parents to save consistently
Why Choose NPS Vatsalya? Unlike other child-saving schemes, NPS Vatsalya offers market-linked returns, ensuring higher potential growth for long-term investments.
Can NPS Vatsalya Be Converted to a Regular NPS Account?
Yes! Once the child turns 18 years old, the NPS Vatsalya account can be converted into a:
Regulated NPS Account – If the child wishes to continue saving under NPS.
Non-NPS Scheme – The funds can be withdrawn and used for other purposes.
Important: The child must complete KYC formalities within 3 months after turning 18 to transition the account.
How to Open an NPS Vatsalya Account for Your Child?
Opening an NPS Vatsalya account is a simple online process. Follow these easy steps:
Step-by-Step Registration Process
Visit the Official Website – Go to NPS Trust Official Website
Choose a CRA (Central Recordkeeping Agency) – Select from:
Protean
KFintech
CAMS
Fill in the Required Details – Enter the following information:
Child’s Full Name & Date of Birth
Guardian’s Name & Date of Birth
Guardian’s PAN Number
Guardian’s Email ID & Mobile Number
Submit the Application – Click on
"Open NPS Vatsalya Account" to complete the process.
Note: The account is opened in the minor’s name and is managed by the guardian until the child turns 18 years old.
Key Benefits of NPS Vatsalya Scheme
Secure Future Planning – Ensures financial stability for the child's higher education or career needs.
Flexible Investment – Invest ₹1,000 or more monthly as per financial capability.
No Fixed Maturity Date – Parents can continue contributing even after the child turns 18.
Market-Linked Returns – Higher growth potential compared to fixed-return schemes.
Tax Benefits – Enjoy deductions under Section 80CCD (1B) of the Income Tax Act.
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