Here is good news for the Indian Diaspora, as the national pension regulator is all set to bring a new scheme for them to invest into National Pension System.
Last year the Reserve Bank of India (RBI) had allowed NRIs to subscribe to the National Pension Scheme (NPS) and had also said that there would be no restriction on repatriation of the annuity/accumulated savings. Following this step of RBI, this year The National Pension System’s Regulator the Pension Fund Regulatory and Development Authority (PFRDA), has planned to launch a ‘non-repatriable’ scheme for NRIs, that will make it easier for NRIs to subscribe to the NPS as it will involve less procedures, and do away with some restrictions of the RBI. The PFRDA has also written to the RBI seeking approval for the launch of a separate NPS scheme for NRIs on non-repatriable basis.
As of today NRIs can invest only in NPS on a repatriable basis. In case of repatriability, there are certain restrictions, so PFRDA has written to RBI about its plans of ‘non-repatriable’ scheme for NRIs.
According to Hemant Contractor, Chairman, Pension Fund Regulatory and Development Authority, “NRI investments in NPS are not taking off well. We are looking at other options like allowing them to put money in NPS on a non-repatriable basis”.
Earlier until last year the subscription amounts have to be paid either by inward remittance through normal banking channels or out of funds held in their Non-Resident (External) Rupee / Foreign Currency Non-Resident (Bank) / Non-Resident Ordinary Rupee Account. This movement of RBI was in-lieu of the fact that India has the second largest Diaspora of 29 million people living across the globe.