NPS Withdrawal Rules – Partial or Premature Withdrawal Rules

byDilip PrasadLast Updated: August 9, 2023
NPS Withdrawal Rules – Premature or Partial Withdrawal Rules

NPS, or National Pension System, is a long-term asset intended to secure people financially after they have retired from their job. This scheme offers flexibility for premature and partial NPS withdrawals under certain situations.

Even when the scheme matures, the investors have distinct options for withdrawal, subject to specific guidelines. Making an NPS investment using online mode or via a broker while knowing the various withdrawal options can help you better manage the investment. A regular NPS withdrawal can be made as the subscriber reaches the age of 60 years. Early withdrawal is also allowed, but it comes with conditions and limits. Let us discuss the NPS withdrawal rules in detail.

Understanding NPS Withdrawal Rules

The most recent NPS exit rules, along with the investing procedure, legalities, and development of all agendas regarding NPS, are all administered by PFRDA (Pension Fund Regulatory and Development Authority). According to the guidelines of PFRDA, an overview of the prevailing NPS withdrawal rules for government employees and corporate employees is listed below:

  • Anyone from the government or private sector can withdraw maximum 60 per cent of the NPS corpus as a lump sum after retirement. The other 40 per cent must be used for acquiring annuities. In terms of NPS, annuities are a monthly amount a subscriber is entitled to from ASP (Annuity Service Provider).
  • If the amount of NPS corpus is less than 2 lakh INR, the person can withdraw the whole amount as a lump sum.
  • As per the existing NPS withdrawal rules, a government employee who chooses voluntary retirement must spend at least 80 per cent of the NPS corpus on annuities. The whole amount may be withdrawn if the corpus is fewer than 1 lakh INR.
  • If the subscriber’s premature death happens, the whole NPS corpus amount will go into the name of the nominee or legal recipient as a lump sum.
  • The subscriber is only entitled to partial NPS withdrawal if he or she has invested in the scheme for a minimum of three years. Moreover, NPS partial withdrawal is permissible only in exceptional cases like covering medical costs, managing the expenses of education and marriage of children.

Documents Required for NPS Withdrawal

Here is a list of documents required for NPS withdrawal:

  • Stamped receipt filled and signed, as well as the revenue stamp of the concerned NPS subscriber.
  • KYC documents and PAN card.
  • Cancelled cheque, bank passbook, bank’s letterhead, and bank statement with proof of the name, number, and IFSC code of the account holder.
  • If entitled to complete withdrawal, the applicant must also issue an undertaking cum request form.

NPS Partial Withdrawal Rules

If a subscriber wishes to exit NPS investment and withdraw the NPS amount before superannuation (at the age of 60 years), it is allowed by the PFRDA. But there are specific NPS withdrawal conditions to follow:

  • Considering NPS partial withdrawal rules for govt employees and corporate employees, the subscriber must have been in the system for at least three years from the joining date. In the case of the “All Citizens” sector, the date of PRAN (Permanent Retirement Account Number) generation is considered.
  • The subscriber shall be permitted to exit not more than thrice during the whole term of the subscription.
  • The subscriber may choose a withdrawal that does not exceed 25% of his or her contributions.

NPS Partial Withdrawal Process

According to the PFRDA, the subscriber can avail of partial withdrawal based on self-declaration. Also, there is no need to submit any supporting document for the partial withdrawal. Here are the steps the subscriber must follow:

  • You can request a partial withdrawal online on the CRA (Central Recordkeeping Agency) system ( by logging in with PRAN using your User ID and Password.
  • Next, choose the option “Tier 1 Partial Withdrawal” under the “Continuation & Withdrawal” tab. Here the subscriber can see the entitled amount for partial withdrawal.
  • You must provide the necessary percentage and purpose behind the partial withdrawal.
  • At the time of processing your request, your bank account will undergo verification via online bank account verification. Your bank must be present in the empanelment list for online bank account verification. If the verification is successful, you can initiate a withdrawal request.
  • You must approve the self-declaration as a reason for partial withdrawal.
  • You must submit the request with OTP authentication or eSign. To verify through OTP, two OTPs will be sent to your mobile number and email registered with CRA. If you use eSign, an OTP will be sent to your Aadhaar-registered mobile number.
  • If the submission is successful, the withdrawal request will get executed in the CRA system. You may not need to submit any supporting documents.
  • The partial withdrawal amount will be transferred to your bank account within the specified timeframe.

Also Read: How to Open an NPS Account?

NPS Premature Exit Rules 

Below, we have discussed the conditions associated if you want to opt for premature exit or voluntary retirement.

Government Sector

  • As per the NPS withdrawal rules for govt employees, a complete lump sum withdrawal is permitted if the corpus is below or equal to 2.5 lakh INR. 
  • If the corpus is more than 2.5 lakh INR, about 80% of the accrued pension wealth must be used for buying an annuity. The annuity will cover the subscriber’s per-month pension, and the balance of 20% should be paid to the subscriber as a lump sum.
  • The subscriber may choose and be encouraged to continue in the NPS system under “All Citizen” mode after executing ISS (Inter Sector Shifting).

Non-Government Sector

  • At least a five-year subscription is mandatory if the subscriber belongs to the private sector.
  • A complete lump sum withdrawal is allowed if the corpus is below or equal to 2.5 lakhs INR.
  • If the corpus is over 2.5 lakh INR, at least 80% of the collected pension must be used for purchasing an annuity. The remaining 20% is paid to the subscriber as a lump sum.  

How to Check the Status of NPS Withdrawal?

A subscriber can check the NPS withdrawal status by following any of the methods below:

  • You can check the status of NPS withdrawal via the Limited Access View (pre-log-in) function. This option is available on the home page of the CRA website.
  • You can also check the NPS withdrawal status by choosing “Withdrawal Request Status View” under the “Exit Withdrawal Request” menu by logging into your NPS account.

Also Read: NPS vs PPF


The article above states the conditions and rules you must adhere to for NPS withdrawal. These can be children’s education, marriage, treatment of serious illnesses, or buying or constructing a residential property. You may have understood that partial withdrawals are subject to specific rules and conditions; they allow individuals to cover their financial necessities and address urgent needs. If you are an NPS subscriber, you must be mindful of all NPS withdrawal rules and follow them after making your investments.


Can I withdraw money from my NPS account before retirement?

Yes, partial withdrawals are allowed under certain circumstances. As per NPS rules, subscribers can withdraw up to 25% of their own contributions after completing 3 years of account opening for specific purposes like higher education, marriage, purchase/construction of a house, or treatment of critical illnesses.

Can I withdraw the entire amount from my NPS account at once?

No, complete withdrawal of the NPS account is not allowed. At least 40% of the accumulated corpus must be utilized to purchase an annuity plan, which will provide a regular pension post-retirement.

Can I exit NPS before the age of 60?

Yes, subscribers can exit NPS before the age of 60, but it is considered an early exit. In such cases, at least 80% of the accumulated corpus must be used to purchase an annuity plan, and only the remaining 20% can be withdrawn as a lump sum.

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