Employer NPS has become increasingly attractive, especially under the New Tax Regime. In fact, the employer's NPS contribution under Section 80CCD (2) is one of the few meaningful tax deductions still available. Because of this, many employees may be tempted to move their existing NPS accounts to the Corporate Sector model. While the tax benefits are undoubtedly attractive, there are several operational changes and lesser-known implications that are rarely discussed. None of these are deal-breakers, but they're worth understanding before making the switch. Here are some things I discovered along the way. 🎯 PFM & Asset Allocation Lock-In Under Corporate NPS, the employer may choose the Pension Fund Manager (PFM) and asset allocation on the behalf its employees. The problem? One size doesn't fit all. You might be a young investor with a long investment horizon and a high risk appetite. Yet your employer may select a conservative scheme with lower equity exposure. Over de...
In one of my other articles, I discussed some of the lesser-known changes that come with moving from an All Citizen NPS account to Corporate NPS. One of those changes is the possibility of being moved to a different Central Recordkeeping Agency (CRA). When I enrolled in my employer's NPS program, my NPS account was migrated from Protean CRA (formerly NSDL CRA) to KFintech CRA. At that point, I had already been investing in NPS for nearly 6 years and had become quite familiar with the ecosystem. Unfortunately, my experience with the migration and the new CRA has been far from smooth. Support Process That Creates More Work The first thing I noticed was the support experience. Creating and tracking grievances is unnecessarily complicated. The portal itself is difficult to navigate and often behaves unpredictably. Attachments uploaded while raising grievances don't appear when tracking the issue later. Even more frustrating was the quality of responses. Whether through email, phone...