NPS subscribers can soon get an option to invest in National Pension Scheme through SIP or systematic investment plan. SIP in NPS will work just like SIP in mutual funds does. SIP is a technique where an investor can order her bank to debit a specific sum at regular intervals towards an investment.
“We are working seriously to bring an SIP like model for NPS subscribers where they can direct their banks to auto debit a specific amount on regular intervals towards investment in NPS,” says Amit Sinha, Executive Vice President, NSDL e-Governance.
Sinha did not put a date to the launch of SIP in NPS though. He said,” I am not putting a date to it but in few months NPS subscribers can expect the SIP facility.”
Systematic investment plan facility is a great way to invest for retail investors. Sinha explained just like people pay their other utility bills like phone, electricity and so on through auto debit instructions, they will be able to invest in NPS once the SIP facility is launched.
The government is making continuous efforts to improve NPS and make it more attractive for investors.
A few days ago, the government notified the NPS tier-II account as eligible for tax deduction under Section 80C. Previously, NPS tier-II had no lock-in, but after the notification, such tax-deductible contributions by the government employees will be locked in for three years.
Private sector contributions to the NPS tier-II account will however not get any deductions and will continue to remain free from lock-in.
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