NPS rules changed for Central Autonomous Body employees: Here's what's new from July 2026
Under the latest decision, employees of Central Autonomous Bodies covered under the NPS can now choose from two additional life cycle investment funds through the Central Recordkeeping Agency (CRA) platform.
- Jul 8, 2026,
- Updated Jul 8, 2026 2:34 PM IST
Employees of Central Autonomous Bodies (CABs) covered under the National Pension System (NPS) will now have more flexibility in deciding how their retirement savings are invested. The Finance Ministry has extended two additional investment choices — earlier available only to central government employees — to eligible CAB employees, giving them greater freedom to align their pension investments with their financial goals and risk appetite.
The Department of Expenditure announced the decision through an Office Memorandum issued on July 1, 2026, extending the applicability of the Department of Financial Services' notification dated November 13, 2025. The move is expected to bring greater parity between central government employees and employees of central autonomous bodies enrolled under the NPS.
What has changed?
Under the latest decision, employees of Central Autonomous Bodies covered under the NPS can now choose from two additional life cycle investment funds through the Central Recordkeeping Agency (CRA) platform.
Until now, these investment options were available only to central government employees. Their extension means eligible CAB employees will now enjoy the same flexibility in selecting an investment strategy that matches their retirement planning needs.
The government said the additional options are designed to cater to subscribers with varying risk-return preferences and investment horizons.
What are the two new investment options?
The first option is LC-75 High, formerly known as the Aggressive Life Cycle Fund. It allows equity exposure of up to 75%, making it suitable for younger investors or subscribers with a long investment horizon who are comfortable taking higher market risk in exchange for the possibility of higher long-term returns.
The second option is the Aggressive Life Cycle Fund, previously known as the Balanced Life Cycle Fund (BLC). This option caps equity exposure at 50%. As the subscriber grows older, the allocation to equities gradually reduces after the age of 45, shifting a larger portion of the portfolio to relatively less volatile asset classes to help preserve retirement savings.
These two options are in addition to the investment choices already available under the National Pension System.
MUST READ: How employer contributions to NPS can push effective tax-free income to ₹13.5 lakh
What remains unchanged?
The latest decision does not alter the basic structure of the National Pension System or the contribution rules applicable to employees of Central Autonomous Bodies.
Subscribers will continue to contribute to their NPS accounts under the existing framework. The change only expands the range of investment choices available for managing their pension corpus.
Operational guidelines governing NPS accounts also remain unchanged.
How can employees opt for the new funds?
Eligible subscribers can exercise their preferred investment choice through the Central Recordkeeping Agency (CRA) system, subject to the operational guidelines prescribed under the NPS.
The Finance Ministry has directed all administrative ministries and departments to inform the Central Autonomous Bodies under their administrative control about the availability of these two additional investment options so that eligible employees can make an informed choice.
MUST READ: Retiring soon? NPS overhaul lets you earn more, withdraw smarter
Why has the government introduced the change?
According to the Finance Ministry, the objective is to provide greater investment flexibility to NPS subscribers by enabling them to select a pension investment strategy that reflects their individual risk appetite, financial goals and retirement planning requirements.
The government said the move also strengthens subscriber choice and enhances the attractiveness of the National Pension System. By extending the same investment options already available to central government employees, the latest decision creates a more uniform pension framework for employees across Central Autonomous Bodies while allowing them to build retirement savings in a manner best suited to their long-term financial objectives.
MUST READ: NPS new rules 2026: PFRDA now allows annuity exit in critical illness cases, eases lock-in norms
Employees of Central Autonomous Bodies (CABs) covered under the National Pension System (NPS) will now have more flexibility in deciding how their retirement savings are invested. The Finance Ministry has extended two additional investment choices — earlier available only to central government employees — to eligible CAB employees, giving them greater freedom to align their pension investments with their financial goals and risk appetite.
The Department of Expenditure announced the decision through an Office Memorandum issued on July 1, 2026, extending the applicability of the Department of Financial Services' notification dated November 13, 2025. The move is expected to bring greater parity between central government employees and employees of central autonomous bodies enrolled under the NPS.
What has changed?
Under the latest decision, employees of Central Autonomous Bodies covered under the NPS can now choose from two additional life cycle investment funds through the Central Recordkeeping Agency (CRA) platform.
Until now, these investment options were available only to central government employees. Their extension means eligible CAB employees will now enjoy the same flexibility in selecting an investment strategy that matches their retirement planning needs.
The government said the additional options are designed to cater to subscribers with varying risk-return preferences and investment horizons.
What are the two new investment options?
The first option is LC-75 High, formerly known as the Aggressive Life Cycle Fund. It allows equity exposure of up to 75%, making it suitable for younger investors or subscribers with a long investment horizon who are comfortable taking higher market risk in exchange for the possibility of higher long-term returns.
The second option is the Aggressive Life Cycle Fund, previously known as the Balanced Life Cycle Fund (BLC). This option caps equity exposure at 50%. As the subscriber grows older, the allocation to equities gradually reduces after the age of 45, shifting a larger portion of the portfolio to relatively less volatile asset classes to help preserve retirement savings.
These two options are in addition to the investment choices already available under the National Pension System.
MUST READ: How employer contributions to NPS can push effective tax-free income to ₹13.5 lakh
What remains unchanged?
The latest decision does not alter the basic structure of the National Pension System or the contribution rules applicable to employees of Central Autonomous Bodies.
Subscribers will continue to contribute to their NPS accounts under the existing framework. The change only expands the range of investment choices available for managing their pension corpus.
Operational guidelines governing NPS accounts also remain unchanged.
How can employees opt for the new funds?
Eligible subscribers can exercise their preferred investment choice through the Central Recordkeeping Agency (CRA) system, subject to the operational guidelines prescribed under the NPS.
The Finance Ministry has directed all administrative ministries and departments to inform the Central Autonomous Bodies under their administrative control about the availability of these two additional investment options so that eligible employees can make an informed choice.
MUST READ: Retiring soon? NPS overhaul lets you earn more, withdraw smarter
Why has the government introduced the change?
According to the Finance Ministry, the objective is to provide greater investment flexibility to NPS subscribers by enabling them to select a pension investment strategy that reflects their individual risk appetite, financial goals and retirement planning requirements.
The government said the move also strengthens subscriber choice and enhances the attractiveness of the National Pension System. By extending the same investment options already available to central government employees, the latest decision creates a more uniform pension framework for employees across Central Autonomous Bodies while allowing them to build retirement savings in a manner best suited to their long-term financial objectives.
MUST READ: NPS new rules 2026: PFRDA now allows annuity exit in critical illness cases, eases lock-in norms