Centre allows one-time switch from UPS to NPS: Know benefits
What's the story
The Indian government has launched a one-time switch facility from the Unified Pension Scheme (UPS) to the National Pension System (NPS). The move, announced by the Ministry of Finance, is applicable for central government employees. Those who are already in UPS and choose to switch to NPS before September 30, 2025, will get assured payouts and other benefits under this new scheme.
Facility specifics
When can employees switch?
The switch facility can be availed by UPS subscribers any time before one year of superannuation or three months before the deemed retirement date in case of voluntary retirement. However, it won't be applicable in cases of removal, dismissal or compulsory retirement as a penalty. The same rules will apply for resignation and other cases with minor changes if required.
Benefit implications
What happens after the switch?
Once the switch is made, the provisions of PFRDA (Exit & Withdrawal under NPS) Regulations, 2015 will apply. This means that employees who switch from UPS to NPS will no longer be eligible for assured payouts and other benefits under the UPS scheme. However, the government's differential contribution (4%) at default investment pattern will be credited to their individual NPS corpus at exit time.
Scheme details
What's the UPS scheme?
The government introduced UPS as an option under the NPS for Central government employees from April 1, 2025. The scheme promises assured payouts to its members. So far, 31,555 Central government employees have opted for it till July 20, 2025. The last date for enrollment under this beneficial scheme is September 30, 2025.