Wed Sep 18 15:50:12 UTC 2024: ## New NPS Vatsalya Scheme Launched for Children’s Future Security

**New Delhi:** The Indian government has launched a new pension scheme, NPS Vatsalya, allowing parents to secure their children’s future by investing in the National Pension System (NPS). Announced in the recent budget, the scheme was formally launched by Finance Minister Nirmala Sitharaman on Wednesday.

The NPS Vatsalya scheme allows parents to contribute to their children’s future financial security through a dedicated NPS account. The scheme offers a flexible investment option with a minimum annual contribution of ₹1000 and no upper limit. The accumulated funds will be eligible for compounding interest, potentially generating a substantial amount for the child’s future.

**Eligibility and Key Features:**

– The scheme is open to all Indian citizens, including NRIs.
– Legal guardians of minors can open NPS Vatsalya accounts on their behalf.
– The scheme is available to minors below 18 years of age who hold a PAN card.
– The investment is subject to a three-year lock-in period.
– Withdrawals are allowed up to three times after the lock-in period for specific purposes like education, critical illness, or disability.
– Up to 25% of the contributions can be withdrawn on each occasion.
– Upon maturity, 80% of the accumulated funds above ₹2.5 lakh will be used to purchase an annuity, while the remaining 20% can be withdrawn as a lump sum.
– For accumulated funds below ₹2.5 lakh, the entire amount can be withdrawn at maturity.

**Opening an NPS Vatsalya Account:**

– The scheme can be accessed through various points of presence (POPs), including major banks, India Post, and pension funds.
– Online account opening is also available through the e-NPS platform.
– ICICI Bank has already started registering NPS Vatsalya accounts, issuing PRANs (Permanent Retirement Account Number) to new customers.

The NPS Vatsalya scheme offers a viable and convenient option for parents seeking to secure their children’s future. With its flexibility, accessibility, and potential for wealth accumulation, it is likely to gain popularity among Indian families.

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