Sitharaman launches NPS Vatsalya, parents can open pension a/c for children

Finance Minister Nirmala Sitharaman on Tuesday launched the NPS Vatsalya scheme, which will allow parents to save for their children's future by investing in a pension account.

Parents can subscribe to NPS Vatsalya online or visiting a bank or post office. The minimum contribution to open Vatsalya account is Rs 1,000. Subscribers will have to contribute Rs 1,000 annually thereafter.

The guidelines for withdrawal from NPS accounts are being finalised.

Launching the scheme, Sitharaman said NPS has generated very competitive returns and offers the option to people to save while ensuring future income.

NPS Vatsalya is an extension of the already existing NPS to children. In the last 10 years, NPS has 1.86 crore subscribers with an Asset Under Management (AUM) of Rs 13 lakh crore.

Children below the age of 18 years can open NPS Vatsalya account, which will automatically get converted to regular NPS account on completion of 18 years of age. Pension will come from the account only upon