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The Pension Fund Regulatory and Development Authority (PFRDA), which is responsible for regulating India’s pension sector, has made an important announcement regarding the National Pension System (NPS). Starting from July 1, there will be a significant change in how settlements for NPS transactions are handled.
The new rule introduces a T+0 system for settlements. This means that trades in shares will be settled on the same day they occur. In practical terms, this means that shares will be quickly transferred to the buyer’s account, while funds will be promptly deposited into the seller’s account.
Previously, contributions to the NPS were invested on the next settlement day (T+1), resulting in a delay of one day before investments were made. However, under the new system, contributions received by the Trustee Bank until 11 am on any settlement day will be invested on the same day. This allows subscribers to benefit from the same-day Net Asset Value (NAV).
In addition, D-Remit contributions received by 9:30 am were already considered for same-day investment. Now, contributions received via D-Remit until 11 am will also be invested on the same day, using the applicable NAV.
To ensure that subscribers can take advantage of these changes, PFRDA has advised Points of Presence (PoPs), Nodal Offices, and NPS Trust for eNPS to adjust their operations accordingly. This will help to ensure that the benefits are delivered to subscribers in a timely manner.
Overall, this change is aimed at streamlining the investment process and enhancing the efficiency of NPS transactions. It will make it easier and faster for subscribers to access the benefits of the National Pension System.