PFRDA Revises NPS Vatsalya Scheme to Enhance Flexibility and Investment Options

The Pension Fund Regulatory and Development Authority (PFRDA) has revised the NPS Vatsalya scheme, launched in the 2024-25 budget to help parents invest for their minor children's future. The updated rules allow partial withdrawals of up to 25% of contributions for education, medical treatment, or disabilities after five years, with withdrawals permitted in instalments before the child turns 21. Additionally, up to 75% of investments can be allocated to equities to potentially enhance returns. Upon reaching adulthood, subscribers may transfer funds to a regular NPS account or exit the scheme with up to 80% corpus withdrawal.