Pension Fund Regulatory and Development Authority ,PFRDA) The circular dated September 29, 2022 states, “There are instances where subscribers in the corporate and government sectors have not exercised Inter Sector Shifting (ISS) after leaving their employment due to resignation or retirement. Those subscribers are still Connected with their former employers in NPS Architecture, even though they no longer work with them.”
According to the PFRDA circular, some NPS subscribers are reluctant to shift as the schemes or investment options provided during their employment may not be available in case they all switch to the civilian sector. Such inter-sector shifting (ISS) may necessitate changes in pension fund investments for the time being.
To avoid this, “PFRDA has stipulated that upon switching to all civilian sector, such subscribers under Government/Corporate sector may continue with their current investment strategy and option to use Pension Fund (PF). ”
According to PFRDA’s circular dated September 29, 2022, “Therefore, in the interest of those customers, the government/corporate sector has decided to allow such customers to continue with their existing investment pattern and as Pension Fund (PF) option.” An option, all on their transfer to civilian sector. For such customers, their potential and past contributions will continue to be invested as per the existing investment pattern/PF which was prevalent during their employment.
Instead of continuing with the same investment pattern following inter-sector moving, such customers will be free to choose any alternative investment pattern and PF as well.
Further PFRDA said, “Government customers cannot contribute for them”. NPS Account Post their retirement until they choose to continue with their account. It has been decided that such public sector customers can continue to contribute to their NPS account uninterruptedly even after their retirement without submitting any request in this regard.
CRA Charges by Subscriber
It is to be noted that the Annual Maintenance Charges (AMC) and Transaction Charges of CRAs for customers after their resignation or retirement shall be recovered from the appropriate PRANs from the quarter after their retirement or resignation.
inter sector shifting
PFRDA has urged employers to involve in the process of leaving Inter Sector Shifting (ISS) so that employees can move their NPS accounts to the desired place of presence. In a circular dated March 11, 2021, the Pension Fund Regulatory and Development Authority stated that, “It is observed that there are instances in which NPS subscribers under the Corporate Sector have opted for Inter Sector Shifting (ISS) before leaving the dues to their employers.” Due to various reasons like resignation, retirement etc. and those employees are still tagged with their former employers in the Central Record Keeping Agency (CRA) system even though they no longer work with those employers ”