New NPS rules may allow gold, more stocks, no annuity: Private savers, take note
The NPS stock universe could expand from the top 200 to the top 500 companies. For the first time, gold and silver ETFs, along with multi-asset funds, may be allowed.
- Sep 4, 2025,
- Updated Sep 4, 2025 8:59 AM IST
The National Pension System (NPS) is about to get its biggest upgrade in 20 years — and it could change how you save for retirement. From flexible investments to lower charges, the upcoming reforms aim to make NPS work better for private sector workers, freelancers, and first-time savers.
According to Fynprint, a wealth advisory platform closely tracking the overhaul, India’s pension regulator PFRDA is planning a sweeping shake-up of the NPS. The goal: to make the system more modern, easier to use, and competitive with mutual funds.
Here’s what’s on the table:
More investment choices: The NPS stock universe could expand from the top 200 to the top 500 companies. For the first time, gold and silver ETFs, along with multi-asset funds, may be allowed.
Customised funds: Target maturity and blended age-based funds may be introduced. This means younger investors could access growth-oriented options, while those nearing retirement can shift into safer funds automatically.
Simpler bond rules: Fund managers could be allowed to invest in bonds with just a single credit rating and without the current three-year residual maturity restriction.
On the distribution side, the current fee structure — a 0.5% contribution charge and 0.09% PFM fee — could be replaced by a single Total Expense Ratio (TER) of 0.5–0.6%, much like what mutual funds offer. This recommendation comes from a committee headed by SEBI-registered advisor Harsh Roongta.
Fund managers, quoted by Fynprint, said annuity rules also need reform. Right now, 40% of your retirement corpus must be used to buy an annuity. The new proposal would allow a Systematic Withdrawal Plan (SWP) — giving retirees more flexibility and potentially better returns.
Executives at HDFC, SBI, and ICICI Pension Funds all backed these changes, saying they would improve performance, increase subscriber comfort, and widen adoption — especially in the under-penetrated private sector.
The changes are still under review but are expected to apply only to private sector NPS accounts.
If approved, this could be the most user-friendly version of NPS yet — with more control, better choices, and real retirement value for everyday investors.
The National Pension System (NPS) is about to get its biggest upgrade in 20 years — and it could change how you save for retirement. From flexible investments to lower charges, the upcoming reforms aim to make NPS work better for private sector workers, freelancers, and first-time savers.
According to Fynprint, a wealth advisory platform closely tracking the overhaul, India’s pension regulator PFRDA is planning a sweeping shake-up of the NPS. The goal: to make the system more modern, easier to use, and competitive with mutual funds.
Here’s what’s on the table:
More investment choices: The NPS stock universe could expand from the top 200 to the top 500 companies. For the first time, gold and silver ETFs, along with multi-asset funds, may be allowed.
Customised funds: Target maturity and blended age-based funds may be introduced. This means younger investors could access growth-oriented options, while those nearing retirement can shift into safer funds automatically.
Simpler bond rules: Fund managers could be allowed to invest in bonds with just a single credit rating and without the current three-year residual maturity restriction.
On the distribution side, the current fee structure — a 0.5% contribution charge and 0.09% PFM fee — could be replaced by a single Total Expense Ratio (TER) of 0.5–0.6%, much like what mutual funds offer. This recommendation comes from a committee headed by SEBI-registered advisor Harsh Roongta.
Fund managers, quoted by Fynprint, said annuity rules also need reform. Right now, 40% of your retirement corpus must be used to buy an annuity. The new proposal would allow a Systematic Withdrawal Plan (SWP) — giving retirees more flexibility and potentially better returns.
Executives at HDFC, SBI, and ICICI Pension Funds all backed these changes, saying they would improve performance, increase subscriber comfort, and widen adoption — especially in the under-penetrated private sector.
The changes are still under review but are expected to apply only to private sector NPS accounts.
If approved, this could be the most user-friendly version of NPS yet — with more control, better choices, and real retirement value for everyday investors.