NPS Update: From October 1, Investors Can Use a Single PAN to Invest in Multiple Pension Schemes

New Delhi, September 17, 2025: The Pension Fund Regulatory and Development Authority (PFRDA) has announced a major reform in the National Pension System (NPS), set to take effect from October 1, 2025. Called the Multiple Scheme Framework, this new rule will give non-government sector subscribers greater flexibility, more choices, and a personalized approach to retirement planning.

Until now, subscribers could invest in only one scheme per tier. But under the new system, investors will be able to manage multiple pension schemes using the same PAN number, making it easier to diversify across different investment strategies within a single account.

What Will Change From October 1?

Starting next month, NPS subscribers in the private and unorganized sectors will have the option to:

• Invest in multiple schemes under one PAN through different Central Recordkeeping Agencies (CRAs).

• Select from new schemes launched by pension funds targeting groups like corporate employees, gig workers, and self-employed professionals.

• Choose from at least two risk variants—moderate and high risk. In the high-risk option, up to 100% investment in equities will be permitted, allowing aggressive investors to aim for higher returns.

Earlier, investors were restricted to just one scheme per tier, limiting flexibility. With the new structure, subscribers gain more control, transparency, and adaptability in retirement planning.

More Flexibility, Smarter Diversification

One of the biggest advantages of the Multiple Scheme Framework is the ability to maintain both conservative and aggressive strategies in a single account. For instance, an investor may allocate part of their savings into a stable, low-risk scheme for security, while channeling another portion into equity-heavy schemes for higher long-term growth.

Subscribers will also benefit from improved account tracking and transparency. They will receive scheme-wise and consolidated account statements through their PRAN (Permanent Retirement Account Number), making it easier to monitor performance and adjust investments.

Low-Cost Structure Remains

Despite the added flexibility, the NPS will continue to maintain its hallmark low-cost structure:

• Annual charges will remain capped at 0.30%.

• Pension funds that successfully bring in more new investors will be rewarded with an additional 0.10% incentive.

• Importantly, withdrawal rules will remain unchanged. Investors will still need to purchase an annuity at the time of retirement to ensure lifelong income.

Existing NPS schemes will now be referred to as “common schemes.” Switching between the newly introduced schemes will only be allowed after a 15-year vesting period or at the time of normal exit.

Why This Reform Matters

The NPS has been steadily gaining traction among private-sector employees, freelancers, and gig workers, thanks to its cost efficiency and long-term wealth-building potential. By introducing the Multiple Scheme Framework, PFRDA aims to:

• Provide personalized retirement options for diverse categories of workers.

• Allow investors to balance risk and reward more effectively.

• Enhance the overall appeal of NPS as a retirement planning tool.

For many young professionals, especially those in the gig economy, this update could make NPS a more attractive savings option.

Final Takeaway

From October 1, 2025, the NPS landscape is set to transform. With the ability to invest in multiple schemes under a single PAN, subscribers will have greater flexibility to align investments with their financial goals and risk appetite.

For long-term savers, this reform offers the perfect blend of diversification, transparency, and affordability—ensuring that India’s retirement planning system continues to evolve with the changing workforce.