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No OCI? PFRDA says close your NPS Account after renouncing citizenship
The Pension Fund Regulatory and Development Authority (PFRDA) has announced new guidelines for closing National Pension System (NPS) accounts by individuals who renounce their citizenship and do not hold Overseas Citizen of India (OCI) cards. The move aims to streamline compliance and ensure proper handling of pensions.
What does circular say?
'The subscriber is required to forthwith intimate National Pension System Trust (NPS Trust) of the change in status along with proof thereof,' said PFRDA's circular dated April 21.
It said that only Indian citizens, Non-Resident Indians (NRIs), and OCI cardholders are eligible to open and maintain NPS accounts. Therefore, those who have renounced Indian citizenship and do not hold an OCI card can no longer remain part of the NPS framework.
According to new rules, the account of such a subscriber must be closed, and the entire accumulated corpus will be transferred exclusively to their Non-Resident Ordinary (NRO) bank account. The process must align with the Foreign Exchange Management Act (FEMA) guidelines.
How to close the NPS account?
To close the account, subscribers must submit a formal request to the NPS Trust. The application should include:
- A written undertaking confirming renunciation of Indian citizenship and the absence of an OCI card.
- Valid proof such as a renunciation certificate, surrender certificate, or cancelled Indian passport issued by a competent authority.
Once the required documents are submitted, the NPS Trust will initiate the closure and fund transfer process in coordination with Central Recordkeeping Agencies (CRAs). 'The total accumulated pension wealth of the subscriber… shall be transferred only to the NRO account of the subscriber, under the FEMA guidelines,' said the circular.
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