Exit Guidelines in National Pension System (NPS) | What is Pension in CPS System

PFRDA Exit Guidelines from National Pension System (NPS) or CPS. Guidelines for Withdrawal of Accumulated Pension Wealth from National Pension System (Popularly known as New Pension Scheme) or CPS are released by PFRDA with certain amendments from time to time. The following are the details for the withdrawals allowed in  case of Government Employees subscribers (CPS Subscribers for AP Govt Employees):

Exit rules under National Pension System for Government Employee Subscribers

For effective regulation of the exits from National Pension System (NPS) Pension Fund Regulatory and Development Authority (PFRDA) has been issuing various circulars from time to time. In order to enable all the CPS Subscribers and other users to have an access to all the applicable circulars at one place We have collected Some Important Circulars and Placed them Here. For Your Knowledge base, Read our previous post on National Pension System - and Tier-1 Account Details for CPS Subsribers and definitions on some important terms-click here
At the time of Retirement, the 60% Total Accumulated Pension Fund of CPS Subscribers (NPS) can be withdrawn lumpsum or in a phased manner and with the  remaining 40% Amount, the Subscribers have to Purchase a Life Annuity from IRDA approved Life Insurance Companies. The Subscriber will receive the Pension from the Annuity Service Provider on the 40% Amount.

Option for Complete withdrawal of accumulated pension wealth

PFRDA/2013/17 /PDEX/10 23rd October, 2013
In partial modification of exit guidelines provided under master circular no: PFRDA/2013/2/PDEX/2 (at Serial no: 2 & 3) dt: 22/01/2013, it has been decided to provide an option to withdraw the entire accumulated pension wealth to subscribers other than the subscribers of NPS Lite – Swavalamban Scheme, subject to the condition that:
  • The accumulated pension wealth in the subscribers permanent retirement account is equal to or less than Rs.2,00,000/- at the time of superannuation for government employee subscribers or upon attaining the age of 60 years for subscribers falling under All citizen model and Corporate model.
The subscribers wishing to exercise this option shall have to fill the attached request form along with the NPS Withdrawal form while submitting the same to their DDO/PAO/DTO/POP.

Replacing ‘Phased Withdrawal’ with ‘Deferred Withdrawal’

Cir.No. PFRDA/ 2013/ 6/ PDEX /5 March 11th, 2013
Feedback is being received from various stakeholders that the subscribers be given a specific option to defer or time the entire lump sum withdrawal (max 60%) at the time of exit from National Pension System (NPS) rather than forcing them to choose a certain percentage (%) each and every year while choosing the existing ‘Phased withdrawal’ option, including the year in which they are exiting the system.
         The matter has been examined by the Authority and it has been decided to replace the “Phased Withdrawal” option currently available with a “Deferred withdrawal” option whereby the subscriber can time the lump sum withdrawal allowed under NPS at the time of exit, with immediate effect.
       Under the Deferred withdrawal facility, the subscribers at the time of exit from National Pension System (NPS) can exercise an option to defer the withdrawal of eligible lump sum withdrawal and stay invested in the NPS. However, it may be noted that no fresh contributions are accepted and also no partial withdrawals are allowed during such a period of deferment. The subscriber can withdraw the deferred lump sum amount at any time before attaining the age of 70 years by giving a withdrawal application or notice. If no such notice is given, the accumulated pension wealth would be automatically monetized and credited to his bank account upon attaining the age of 70 years.

Exit Rules under NPS (CPS) for Govt Servants 

Guidelines as per Cir no: PFRDA/ 2013/2/ PDEX / 2 SL-2
  1. a) Upon Normal Superannuation: At least 40% of the accumulated pension wealth of the subscriber needs to be utilized for purchase of annuity providing for monthly pension to the subscriber and balance is paid as lump sum payment to the subscriber.
  2. b) Upon Death: The entire accumulated pension wealth (100%) would be paid to the nominee/legal heir of the subscriber and there would not be any purchase of annuity/monthly pension.
  3. c) Exit from NPS before the age of Normal superannuation (irrespective of cause): At least 80% of the accumulated pension wealth of the subscriber needs to be utilized for purchase of annuity providing for monthly pension to the subscriber and the balance is paid as a lump sum payment to the subscriber.
The subscribers would be able to purchase the annuities directly from the empanelled Annuity Service Providers as per their choice of annuity that is available in the market/with the Annuity Service Provider’s(ASP’s) empanelled by PFRDA

Processing of withdrawal requests of Non IRA Compliant subscribers

Cir no: PFRDA/ 2013/2/ PDEX / 2 SL-4
PFRDA has issued necessary instructions to CRA with respect to the withdrawal guidelines for Non IRA Compliant subscribers in case of government servants who have died or resigned. The said information is being re-iterated hereunder for the information of all stakeholders for a better appreciation of the matter.
The following are the details of the process to be followed:

Exit from NPS arising out of death
  • Certification from the concerned PAO/DTO/DDO (attached as annexure I)
  • Affidavit from the claimant (attached as Annexure II.)
  • Filling of respective death claim form along with relevant details
Exit from NPS before the age of normal superannuation & arising out of resignation
Subscriber has to:
  • Submit duly filled S1 form for enabling the complete data capture in CRA system. No PRAN generation activity will be undertaken.
  • Submit duly filled Withdrawal form along with all relevant details and documents
       In case of death where PPAN was assigned but corresponding PRAN was not generated and the respective contribution is held with the concerned employer/department, then, the respective employer/ department may take appropriate decision at their end.

Addl Benefit on death/disability of Govt servant covered by NPS

Cir no: PFRDA/ 2013/2/ PDEX / 2 SL-5
        PFRDA has in past replied to various queries received from various government departments in reference to OM No. 38/41/P&PWA (A) issued by DoP & PW’s dated 05/05/2009 with respect to the additional relief on death/disability of government servants covered by the new Defined Contributory Pension System (NPS). The said information is being re-iterated hereunder for the information of all stakeholders for a better appreciation of the matter.
          It has been decided that additional benefits provided in terms of the said OM are over and above the benefits provided by the National Pension System, as per para 3 of the OM.In case the recovery of the accumulated pension wealth under NPS account is to be undertaken as per government’s decision, it has to be done by the department concerned directly from the subscriber/nominees/legal heirs after due payment from NPS system to them, in order to fulfill the contractual obligations under NPS.

Empanelment of Annuity Service Providers (ASPs) under NPS

Cir no: PFRDA/ 2013/2/ PDEX / 2 SL-6
PFRDA has issued necessary instructions to CRA with respect to the Empanelment of Annuity Service Providers (ASPs) under National Pension System for providing annuity services. The said information is being re-iterated hereunder for the information of all stakeholders for a better appreciation of the matter.
Following seven Annuity Service Providers (ASPs) have been empanelled for the purpose.
  • 1. Life Insurance Corporation of India
  • 2. SBI Life Insurance Co. Ltd.
  • 3. ICICI Prudential Life Insurance Co. Ltd.
  • 4. Bajaj Allianz Life Insurance Co. Ltd.
  • 5. Star Union Dai-ichi Insurance Co. Ltd.
  • 6. Reliance Life Insurance Co. Ltd.
  • 7. HDFC Standard Life Insurance Co. Ltd
The Life Insurance companies would be offering their approved annuity products to NPS subscribers and would also designing products suiting the requirements


  1. I joined as S.G.T. on 14th Nov, 2005. Our D.Sc notification date was 14th Nov 2003. I feel complete injustice done to us as we are now in New Pension System. No Teacher Union is fighting for us as this has never been their main demand . Even While submitting the New PRC proposals to Govt.,, Teacher Unions are not at all serious about us. Why? I think Even the newly joined S.G.T's getting almost the same salary we are getting now.

  2. I joined as SA(ENGLISH)on 25th Nov,2005. As our D.S.C notification issued on 14th Nov,2003. It is really pathetic
    to say that v r in C.P.S. Teacher Unions are not considering our problems. They are not taking this matter to the notice of Government.i request all unions to come forward to solve our problem.

  3. Sir/Madam, It is an agony to bring to your notice that the government issued GO NO.22, dated on 22nd January,2013 to en-cash our CSS 90%amount . But unfortunately in our treasury they have not considered so far. As v have submitted bills 3 months ago. They r telling that they don't have time to do that. it's really pathetic to say.

  4. I wish to inform you that GO.22, dt:22-1-13 is not at all being implemented. Treasury offices not at all insisting M.E.O/D.D.O in this matter. D.T.O should see that as long as this GO is not implemented to C.P.S. teachers, all the other teachers salaries must be stopped with immediate effect.

  5. Great Information provided over here

    thanks for a great support

  6. Can it be a downloaded form

  7. @Gowtham, @Shaik Chanbasha.. You are Right Sir. Severe loss to DSC 2003 Batch Teachers. Not only They lost the Old Pension Scheme, but also The Notional Increments had not benefited to them in PRC 2010. Unions should fight for Old Pension Scheme for DSC 2003 as the New Pension Scheme is not mentioned in the DSC 2003 Notification. Whatever may be the Union, Ask your Union Leaders to fight for you..
    Coming to CPS Arrears and implementing GO.22, It is accepted by most of treasuries. May be some problems in some treasuries..

  8. On reading this post I understood what is pension in CPS system and I got more information on pension payment because it will help me to sell my annuity payments lump sum.

  9. Sir ,i request post new cps scheme advance withdrawal software