nps presentation -updated

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National Pension System (NPS)

Alankit Limited


Introduction

New Pension System (NPS), regulated and monitored by PFRDA reflects Governments effort to find sustainable solutions to the problem of providing adequate retirement income.

•Pension Fund Regulatory & Development Authority (PFRDA) was established by the Government of India, Ministry of Finance, on 10th Oct, 2003 to promote old age security

•PFRDA was further authorized on 29th July 2008 to extend NPS on a voluntary basis to all citizens of India

•NPS is now available to all Citizens of India including workers of both organized and unorganized sectors with effect from May 1, 2009 on a voluntary basis


Objective

Voluntary Defined Contribution Pension System in India

Objectives• To provide old age income• Reasonable returns over the long term contribution• To extend the old age security coverage to all citizens of India

NPS accretes savings into subscribers PRA while he is working and use the accumulations at retirement to procure a pension for the rest of his life.


NPS-Intermediaries

Trustee Bank

Annuity Service ProviderPension Fund Manager

Axis Bank NSDL

7 PFMs registered

Custodian

Stock HoldingCorp (SCHIL)

CRA

Registered POP (Alankit)

7 ASPs registered


Who can Join NPS

A citizen of India, whether resident or non-resident

Between the age group of 18-60 years

Government Employees for Tier 2 account

Undischarged Insolvent, Individual of unsound mind and Pre-Existing account holder under NPS can not join.


• Voluntary : Open to all Indian Citizen• Simple : Open an Account with any of the POP and get PRAN• Flexible : Choose your own Investment Options & PFMs• Portable : Operate your account from anywhere in the country• Regulated : Regulated, Monitored and performance reviewed by

PFRDA.• Tax benefit : Tax benefits applicable under Income Tax Act 1961• PFMs : Pension contributions invested by Professional Pension

Fund Managers• Low Cost : PFM charges 0.01%, ‘lowest in the world’• NRA of 60 : Can withdraw 60% of pension wealth in a lump sum or

in a phased manner• Withdrawal before 60 : Can withdraw 20% of pension wealth in a lump sum

manner

Benefits


Types of Account

Non-

Withdrawable

Account

Voluntary Savings Facility (Withdrawable Account)

Tier I Account

Tier II Account


Subscriber will make first contribution at the time of applying for registration with POP-SP.

The subscriber has option to contribute anytime during the year as per his convenience.

Minimum Contribution at the time of account opening

Rs. 500

Minimum amount per contribution Rs. 500Minimum annual contribution at the end of financial year

Rs. 6000

Minimum no. of contributions 1 per year

Tier I Account


Tier II Account

Tier II is a pension savings account, with a facility for withdrawal to meet financial contingencies

No Account Opening & Account Maintenance Charges by CRA

Only transactions are charged by CRA & POPs

No limit on withdrawals from Tier II account

Investment Patterns same as Tier I

Minimum Contribution at the time of account opening

Rs. 1000

Minimum amount per contribution Rs. 250Minimum annual contribution at the end of financial year

Rs. 2000

Minimum no. of contributions 1 per year


Pension Fund Managers

Kotak Mahindra Pension Fund Management Ltd.

SBI Pension Fund Private Ltd.

UTI Retirement Solution Ltd.

ICICI Prudential Pension Fund Management Ltd.

NPS allows you to choose any one of the seven entities

HDFC Pension Management Company Ltd.

LIC Pension Fund Ltd.

Reliance Capital Pension Fund Ltd.


Withdrawal Option

Vesting Criteria Benefit

At any point in time before 60 years of Age

Person will be required to invest at least 80% of the pension wealth to purchase a life annuity from any IRDA - regulated life insurance company. Rest 20% of the pension wealth may be withdrawn as lump sum.

On Attaining the Age of 60 Years

At exit subscriber would be required to invest minimum 40% of your accumulated saving to purchase a life annuity from any IRDA-regulated life insurance company. The remaining 60% pension wealth can be withdrawn in a lump sum on attaining the age of 60

Death due to any cause

In such an unfortunate event, option will be available to the nominee to receive 100% of the NPS pension wealth in lump sum. If the nominee wishes to continue with the NPS, he/she shall have to subscribe to NPS individually after following due KYC procedure.


Partial Withdrawal Option

* Partial withdrawal of 25% of subscribers’ contribution is allowed thrice till the age of 60 years is attained by the subscriber.

* Such withdrawal is allowed in case of certain exigencies only.

* To claim first partial withdrawal, the subscriber must have remained invested in NPS system for minimum 10 years.

* There should be a time gap of 5 years between two successive withdrawals.


Annuity Service Providers

Subscribers of the National Pension System (NPS) would have a choice to select Annuity Service Providers, and annuity schemes offered by them

PFRDA has at present empanelled the following Seven IRDA approved life insurance companies for providing annuity services to the subscribers of National Pension System (NPS).

Life Insurance Corporation of India SBI Life Insurance Co. Ltd. Star Union Dai-ichi Life Insurance Co. Ltd. ICICI Prudential Life Insurance Co. Ltd. Reliance Life Insurance Co. Ltd. Bajaj Allianz Life Insurance Co. Ltd. HDFC Life Insurance Co. Ltd.


• Pension (Annuity) payable for life at a uniform rate to the annuitant only

• Pension (Annuity) payable for 5, 10, 15 or 20 years certain and thereafter as long as you are alive

• Pension (Annuity) for life with return of purchase price on death of the annuitant (Policyholder)

• Pension (Annuity) payable for life increasing at a simple rate of 3% p.a.

• Pension (Annuity) for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant

• Pension (Annuity) for life with a provision of 100% of the annuity payable to spouse during his/her lifetime on death of the annuitant

Different Types of Annuity


Tax Benefits

Specific Tax Benefits available under various sections of Income Tax Act 1961 towards contributions made in Tier-I account:

U/S 80CCE – up to Rs.1,50,000/ (individual tax limit)

U/S 80CCD(1B) – up to Rs.50,000/ (individual contribution)


Investment Choice

Auto Choice

Active Choice

Life – Cycle Funds

Individual Funds


Wealth Investment Option

ASSET CLASS E EQUITY

ASSET CLASS CCREDIT RISK BEARING

FIXED INCOME INSTRUMENTS

ASSET CLASS G GOVT. SECURITIES

• High Risk• High

Return

• Medium Risk• Medium Return

• Low Risk• Low Return


Wealth Investment Option-Active Choice

• You have the option to actively decide that how your NPS Pension wealth is to be invested in the above three options viz. E, C, & G class assets.

• Cap on the investment into equity is fixed at 50% of your NPS Pension wealth.

• You can choose to invest your entire pension wealth in C or G asset classes too.


Wealth Investment Option-Auto Choice


Subscriber Registration Process Fill up Application form

All mandatory data fields are to be filled by the applicant

Affix a recent passport size colored photograph

Proper Signature/Thumb impression

Valid ID, Address and Date of Birth proof Required with form

Fill up Annexure for obtaining PRAN Card in Hindi


Regular Contribution Acceptance

POP-SP will accept regular contribution from the subscribers as per the norms laid by PFRDA

POP-SP will issue the receipt against the contribution accepted

POP-SP shall immediately deposit the contribution in designated Bank Account

To follow the subscriber/s for the payment against the dishonoured cheque/s bounced if any.


Subscriber Servicing

Range of services to the NPS subscribers: Carry out changes in subscriber details as per subscriber’s

request.

Receiving switch request for change in PFM.

Receiving withdrawal request from subscriber.

Attending to subscribers request for shifting to another POP-SP.

Any other NPS account related service. To forward the above to the POP/POP Reg. office. MIS pertaining to above will be uploaded by POP to CRA.


Grievance Handling

Receiving and uploading Grievances in prescribed format against • POP / POP-SP • Any other NPS Intermediary

NPS has a multi layered Grievances redressal mechanism which is easily accessible

• Call Centre/ Interactive Voice Response System.• Web based interface. You can register the grievance at the website

www.npscra.nsdl.co.in with the use of I-PIN.• Physical form • The status of Grievance already registered can be checked at the above

website. If no response is received within 30 days or are not satisfied, the customer can directly submit his/her grievance to the GRC of PFRDA.


Tier I – Annualized Return

For more info. on Returns, latest NAV, historical NAV, visit https://npscra.nsdl.co.in/nav-search.php

https://npscra.nsdl.co.in/nav-search.php


Tier II – Annualized Return




PFM ReturnsNPS PFM Returns

Tier Scheme From March 31, 2010ICICI PRUDENTIAL PENSION FUNDS MANAGEMENT COMPANY LIMITED

KOTAK MAHINDRA PENSION FUND LIMITED

RELIANCE CAPITAL PENSION FUND LIMITED

SBI PENSION FUNDS PRIVATE LIMITED

UTI RETIREMENT SOLUTIONS LIMITED

LIC PENSION FUND LIMITED (From June 7, 2013)

HDFC PENSION MANAGEMENT COMPANY LIMITED (From Aug 1, 2013)

TIER I

C

March 31, 2011 (Annualized) 9.41% 10.86% 7.82% 12.66% 9.20% NA NA



March 31, 2014 (Annualized) 10.28% 10.40% 9.16% 10.74% 9.69% 7.35% 7.00%


March 31, 2015 (Absolute) 71.17% 71.14% 63.32% 74.02% 66.61% 23.92% 23.27%

E


March 31, 2012 (Annualized) 1.57% 0.22% -0.92% 0.15% -1.75% NA NA




March 31, 2014 (Absolute) 75.40% 71.83% 66.70% 48.44% 65.69% 43.78% 54.35%

G






March 31, 2015 (Absolute) 59.42% 58.73% 57.01% 62.53% 60.80% 27.62% 23.81%

TIER II

C






March 31, 2015 (Absolute) 73.70% 62.04% 57.90% 71.90% 65.05% 17.11% 16.21%

E


March 31, 2012 (Annualized) -0.67% 0.36% -0.93% -0.12% -0.84% NA NA


March 31, 2014 (Annualized) 7.03% 7.59% 6.88% 6.84% 6.67% -1.22% 7.93%


March 31, 2015 (Absolute) 68.81% 71.66% 67.33% 67.43% 69.67% 19.98% 32.51%

G






March 31, 2015 (Absolute) 58.00% 53.47% 54.39% 61.71% 65.84% 28.38% 26.52%


Absolute Returns




Charges


THANK YOU By

Akash Singh


This Presentation has been prepared by Alankit Group and has to be read in conjunction with its oral presentation.

The information in this presentation does not propose to be comprehensive. Neither Alankit nor any of its officers employees, advisors or agents accepts any responsibility for/ or makes any representation or warranty, express or implied, as to the truth, fullness, accuracy or completeness of the information in this presentation (or whether any information has been omitted from the presentation) or any other information relating to Alankit, its subsidiaries or associated companies, whether written, oral or in a visual or electric form, transmitted or made available. This document is confidential and is being provided to you solely for your information and may not be reproduced, further distributed to any other person or published, in whole or in part, for any purpose. This document is directed only at relevant persons. Other persons should not act or rely on this document or any of its contents. No reliance may be placed for any purposes whatsoever on the information contained in this document or any other material discussed during this presentation, or on its completeness, accuracy or fairness. The information in this document and any other material discussed at this presentation is subject to verification, completion and change. The information and opinions contained in this document are provided as at the date of the presentation and are subject to change without notice. By attending the presentation you agree to be bound by the foregoing terms. Trademarks or Registered Trademarks are the property of their respective owners.

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