What Is NPS Vatsalya Scheme That Sitharaman Will Unveil Tomorrow? All You Need To Know

NPS Vatsalya Scheme: Nirmala Sitharaman is set to launch the much-awaited NPS Vatsalya scheme on Wednesday, following its announcement in the Union Budget 2024-25

Nirmala Sitharaman will also unveil an online platform for subscribing to the scheme, release an official brochure, and distribute Permanent Retirement Account Number cards to minor subscribers.

Source : PTI

NPS Vatsalya Scheme: Finance Minister Nirmala Sitharaman is set to launch the much-awaited NPS Vatsalya scheme on Wednesday, following its announcement in the Union Budget 2024-25.

What is NPS Vatsalya scheme?

The new initiative, which allows parents to invest in pension accounts for their children, aims to secure long-term wealth through the power of compounding. It offers flexible contribution options with a minimum investment of Rs 1,000 annually, making it accessible to families across various economic backgrounds.

As part of the launch, the finance minister will also unveil an online platform for subscribing to the scheme, release an official brochure, and distribute Permanent Retirement Account Number (PRAN) cards to minor subscribers.

The scheme facilitates a seamless transition into long-term financial planning, allowing the account to be converted into a regular National Pension System (NPS) account once the minor turns 18.

Who can operate this scheme?

Parents, guardians, NRIs, and OCIs are eligible to open NPS Vatsalya accounts for minors, enabling early retirement savings. "A major advantage of this scheme is the power of compounding, which greatly enhances returns over time," the finance minister mentioned. The plan mandates a minimum contribution of Rs 500 per month or Rs 6,000 annually.

Simultaneous launch events will be held at nearly 75 locations across the country, with many locations joining via video conference. These locations will also distribute PRAN cards to new minor subscribers.

NPS Vatsalya, operated under the Pension Fund Regulatory and Development Authority (PFRDA), is designed to encourage early financial planning for children and secure their financial future.

The Finance Ministry highlighted the government's commitment to promoting long-term financial security, noting that this scheme is a significant step toward ensuring India's future generations are financially independent.