Finance Minister Nirmala Sitharaman Launches NPS Vatsalya: A Pension Scheme for Minors

Launch Event Highlights

The event was attended by Union Minister of State for Finance Shri Pankaj Chaudhary, Secretary of Financial Services Shri Nagaraju Maddirala, and Chairman of the Pension Fund Regulatory Authority of India (PFRDA) Dr. Deepak Mohanty. Many school children, their parents, and other important guests were also present at the event.

To mark the launch, the NPS Vatsalya scheme was introduced at 75 locations across the country. More than 250 Permanent Retirement Account Numbers (PRAN) were distributed to minor subscribers. At each location, school children actively participated in the event, showing great enthusiasm for the new scheme.

Online Platform and Scheme Brochure

At the event, Smt. Sitharaman also unveiled an online platform to make it easier for people to subscribe to NPS Vatsalya. She also released a brochure that explains the features of the scheme in detail.

Both Smt. Sitharaman and Shri Chaudhary handed out PRAN cards to young subscribers who had traveled from various parts of India to be part of the launch.

A Big Step Toward India’s Future

In her keynote speech, Smt. Sitharaman said the NPS Vatsalya scheme is a key step towards achieving PM Modi’s vision of Viksit Bharat@2047. She emphasized that the scheme encourages the habit of saving from a young age, which will help build a large corpus over time through the power of compounding interest. This will ensure that people can live comfortably in their old age.

She also highlighted how this scheme promotes intergenerational equity, meaning it helps support both the young and old members of a family, securing their financial futures.

Impact on Farmers and Pension Schemes

Smt. Sitharaman also celebrated the success of other government pension programs. She mentioned the Atal Pension Yojana, which has attracted 6.90 crore subscribers and built a corpus of ₹35,149 crore since it was launched in 2015. She also noted the competitive returns offered by the NPS scheme, which has delivered 9.5% Compound Annual Growth Rate (CAGR) for government sector subscribers.

Promoting Financial Planning and Education

Shri Pankaj Chaudhary also spoke at the event, saying that the NPS Vatsalya scheme is a major step towards inclusive economic development. He encouraged all institutions involved in implementing the scheme to ensure it reaches as many people as possible.

Shri Nagaraju Maddirala, Secretary of the Department of Financial Services (DFS), stressed the importance of working together with banks and other partners to spread awareness about the benefits of the NPS Vatsalya scheme. He added that the government is also working hard to include more people from the informal sector in the pension system. Financial literacy programs are being run to educate people about the importance of saving for retirement.

Securing the Future for the Next Generation

Dr. Deepak Mohanty, Chairman of PFRDA, said that the NPS Vatsalya scheme is part of the government’s broader effort to provide social security for all. He explained that starting a pension plan early in life helps build a large sum of money through compound interest, which can secure the financial future of young subscribers.

Dr. Mohanty also pointed out that many people delay planning for retirement due to other financial priorities. This often leads to insufficient savings for old age. The NPS Vatsalya scheme aims to change this by encouraging early saving and investment habits.

NPS Vatsalya: Who Can Join?

The NPS Vatsalya scheme is open to all minor citizens of India (those under 18 years of age). Here are some key features:

• The account is opened in the name of the minor, and a parent or guardian will operate it. The minor will benefit from the savings.
• The scheme can be opened through various channels like banks, India Post, Pension Funds, or even through the online e-NPS platform.
• The minimum contribution is ₹1,000 per year, with no upper limit.
• Subscribers can invest in government securities, corporate debt, and equities, depending on their risk preference.
• When the minor turns 18, the account can be easily converted into a regular NPS account.

Conclusion

The launch of the NPS Vatsalya scheme is a significant step towards ensuring financial security for young citizens. With a focus on early savings and long-term growth, this scheme will help children grow into financially secure adults, contributing to the broader vision of Viksit Bharat by 2047.