New Delhi: In what be good news for subscribers of the National Pension Scheme (NPS), the Pension Fund Regulatory and Development Authority (PFRDA) is soon going to allow the investors to change their investment pattern up to four times in a financial year.
According to PFRDA Chairman Supratim Bandyopadhyay, the subscribers have been demanding an increase in investment leeway. Till now, subscribers can change the investment pattern twice in a financial year under the NPS scheme.
PFRDA Chairman Supratim Bandyopadhyay had earlier said that, currently, subscribers can change the investment choice twice a year.
“Now, in a very short period of time, we are going to increase it to four times because there are requests that you allow more number of times (to change the investment pattern),” he was quoted as saying.
PFRDA allows investors to allocate their NPS investments in a fixed ratio between investment opportunities such as government securities, debt instruments, short-term and long-term debts, and equities, among others.
However, there are terms and conditions to the allocation, depending on the type of subscribers. For example, employees working with central or state governments cannot allocate more funds to equities. On the other hand, employees of private firms are allowed to invest up to 75% of their NPS investments in equities.
Investors can change their investment ratios accordingly. According to the PFRDA chairman, NPS is a long-term investment product that can be used to build a pension corpus. Investors should not treat NPS as akin to other investment instruments such as mutual fund schemes, he was quoted as saying by Mint.