FM Nirmala Sitharaman to Introduce NPS-Vatsalya Scheme on Sept 18

Union Finance Minister Nirmala Sitharaman will launch the NPS-Vatsalya program on September 18 in Delhi, according to reports.

Minister of State (MOS) for Finance Pankaj Choudhary, Deepak Mohanty, Chairman of the Pension Fund Regulatory and Development Authority (PFRDA), top officials from the finance ministry, and Secretary of the Department of Financial Services Nagaraju Maddirala will be present at the function.

"NPS-Vatsalya, a scheme for parental and guardian contributions for minors, will be unveiled. FM Sitharaman had stated during her July budget address that "the plan can be seamlessly converted into a regular NPS account upon reaching the age of majority."

The NPS-Vatsalya program is designed with younger people in mind. Parents or guardians can create accounts and make contributions to their minor children's retirement savings under this creative initiative.

The adaptability of the plan is one of its main advantages. To provide a seamless transition into loterm retirement planning, parents have the option to convert the account into a conventional NPS account once the child reaches 18.

The source stated, "FM Sitharaman will also introduce the NPS-Vatsalya scheme via video conference at remote locations."

For their minor children, any parents and guardians—Indian nationals, Non-Resident Indians (NRIs), or Overseas nationals—are able to create an NPS-Vatsalya account.

The scheme's ability to let parents begin saving for their child's retirement as early as infancy is one of its main features. Compounding's potential may greatly increase profits over an extended investment horizon. Furthermore, the child's account will automatically convert into a standard NPS account once they reach age. Beginning with a small monthly commitment of ₹500, parents may contribute up to ₹6,000 annually.

"The NPS Review Committee has advanced its work in a significant way. I am happy that a positive approach has been chosen by the Staff Side of the National Council of the Joint Consultative Machinery for Central Government Employees. During her budget speech, FM Sitharaman stated, "A solution that addresses pertinent issues while maintaining fiscal prudence to protect the common citizen will be developed."