PhonePe has launched a digital account-opening facility for the National Pension System (NPS), allowing users to open a pension account through its app with an initial contribution starting at ₹250.
Called Tatkal NPS, the facility uses existing bank KYC details and one-time password (OTP)-based authentication to complete onboarding without requiring fresh document uploads, according to the company’s announcement on October 27.
PhonePe said it has partnered with banks to offer the facility and plans to expand its coverage to more banking institutions.
Under the process, users can search for NPS on the PhonePe app, select the National Pension Scheme option, choose a linked bank account and verify it through an OTP. They can then make the initial contribution using PhonePe UPI to generate a Permanent Retirement Account Number (PRAN), which identifies an NPS account.
The facility uses the Tatkal NPS framework developed by the Pension Fund Regulatory and Development Authority (PFRDA), which allows eligible users to reuse existing bank KYC details for account opening.
NPS is a government-regulated, defined-contribution retirement savings scheme in which subscribers contribute towards building a retirement corpus. The eventual pension benefits depend on contributions, investment performance and the applicable withdrawal and annuity rules.
PhonePe said the facility is intended to make NPS account opening more accessible to people who may not have access to employer-linked retirement benefits, including gig workers, freelancers and small business owners. However, opening an account and making the initial contribution are only the first steps; building a retirement corpus requires regular contributions over time.
NOTE TO READERS
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Readers should consult certified experts before making any investment decisions.