From ups to nps: Finance ministry opens one -time switch option for Govt Employees – CNBC TV18

In a significant move for Central Government Employees, The Ministry of Finance has introduced a one-time, one-way switch facility allowing alloye empolyees who opted for the unified pen Shift their pension accounts to the National Pension System (NPS).

What is the new switch facility?

The ministry of finance, in its latest notification, has declared that ups subscribers can now switch to the nps any time up to one time up to one year before their before their superannuation oor in case of voluntary retirement.

This option also applies, with some modifications, to employes resigning or retiring under rule 56j. However, employers who do not exercise this switch with the prescribed Timelines will continue control

Who is eligible for the switch?

This switch facility is open exclusively to Central Government Employees Currently Enrolled in UPS. It is important to note that this switch is one-way only-Once Employees Move to NPS, they cannot revrert to ups.
Additional, the switch will not be permitted in cases involving removal, dismissal, compulsory retirement as a penalty, or ongoing disciplinary proceedings.

What Happens after switching to nps?

Employees opting for the switch will then be governed by the provisions of the PFRDA (Exit & Withdrawal Under NPS) Regulations, 2015. Benefits under UPS.

Further, the government’s differential contribution of 4%, based on the default investment pattern, will be calculated and credited to the individuals corpus at the time of exit from us.

Why it matters for Govt Employees

The Introduction of the one-time switch facility provides green and choice to Employees managing their retirement corpus. Many view the nps as a flexible and market-linked pension scheme, potential offering higher returns compared to the fixed payouts under UPS.