NPS is a long-term investment, so if the investor needs money in between, can a partial withdrawal be done from it? Know here what is the rule regarding this.

NPS i.e. National Pension System is a government scheme which has been prepared for retirement. Through this scheme, investors can arrange for retirement fund as well as pension for themselves in old age. Whatever amount you deposit in it, 60 percent of it is given to you as retirement fund, while 40 percent has to be used to buy annuity, which gives you pension. NPS is a long term investment, so if the investor needs money in between, can partial withdrawal be done from it? Know here what is the rule regarding this.

You can make partial withdrawal after 3 years

According to the rules, if you want to make partial withdrawal without closing the NPS account before the age of 60 or before reaching retirement, then you can do so, but for this your account should be at least three years old. You can withdraw a maximum of 3 times during the entire period of your NPS account. PFRDA changed the rules regarding NPS partial withdrawal in February 2024. According to the changed rules, NPS account holders can withdraw up to 25% of the amount from the personal pension account excluding employer contribution.

You can withdraw in these situations

If you need money for your children's higher education, then you can make partial withdrawal from NPS.

Account holders can also make partial withdrawal up to 25 percent for the marriage of children.

Partial withdrawal can also be done for buying a house, home loan repayment, etc., but if you or your spouse already have a house in your name, then you will not be able to avail this facility to buy another house.

Money can be withdrawn from the NPS account for hospitalization and treatment expenses during serious illnesses.

Money can be withdrawn in case of becoming medically disabled or disabled due to an accident.

Money can be withdrawn for hospitalization or treatment in case of a serious illness.

You can also withdraw money to start any kind of business, for startup, skill development or for any course.

How can you withdraw money?

To withdraw 25 percent or less of the amount under NPS, first, you have to apply to any government nodal agency of NPS. Along with this application, you have to give a self-declaration as to for what purpose you are withdrawing the money. After this, the application has to be submitted to the Central Recordkeeping Agency (CRA). Then the agency will process the application after verification. If the subscriber is ill, then a family member or nominee can make this request on his behalf.