BAJAJ BROKING
January 25, 2025
4 mins read
In this blog, we will discuss the PRAN card and how it works. We will touch upon the NPS account types, and then talk about how to apply for a PRAN card online and offline.
Permanent Retirement Account Number Card, or PRAN Card, is a unique identification number with 12 digits, and is issued to the individuals registered under the National Pension Scheme, NPS. PRAN helps with managing all pension-related transactions of an individual without hassle. This secures the pension transactions, and works as a gateway for transparent and structured retirement savings.
PRAN remains active and can be accessed even if the subscriber switches jobs, or moves to another city. It’s highly portable and is efficient in its maintenance. For those who are interested in retirement savings and securing their post-retirement future, a bit of education about PRAN cards is a must. Now that we know what is PRAN card, let’s go further and learn more about it..
The PRAN card accommodates two types of accounts under the NPS framework. These accounts vary in terms of financial needs and objectives. The two accounts are categorized as Tier I and Tier II.
Tier I Account:
This is the pension account by default, which comes with restrictions on withdrawal to ensure the creation of a robust retirement corpus.
Contributions are to be made as a minimum annual requirement to keep the account active.
The money in this account is not available for withdrawal until retirement, though there is permission for partial withdrawals made for education or medical emergencies.
Tax benefits under Section 80CCD (1B) and 80C of the Income Tax Act are available, thus saving a lot of money.
Tier II Account:
The Tier II account is an optional add-on to the NPS account. It is more of a savings account where there is complete flexibility regarding deposits and withdrawals.
The account does not enjoy tax benefits over the Tier I account. It is used for short-term financial planning.
Here, the subscribers can keep surplus funds that can be liquidated at their own discretion. Still, the corpus of retirement funds will be accessible separately.
Together, these two accounts allow people to plan their future while providing for immediate expenses. The PRAN card enables easy access and management of the accounts from one interface.
The following are some valid reasons why one should have a PRAN card.
Unique Identification: A single 12-digit number ensures your contributions and details remain distinct and secure.
Comprehensive Tracking: Allows effortless monitoring of contributions, fund performance, and investment allocations.
Nationwide Portability: Retain the same PRAN card regardless of job changes, employer transitions, or geographic moves.
Digital Accessibility: Provides online access to account details and facilitates easy transactions through CRA portals.
Tax Efficiency: Provides exemption under Sections 80C and 80CCD thereby reducing taxable income.
Increased Transparency: Subscribers have a full view of all activities in the account, building trust and accountability.
Government Regulation: Being a government-backed scheme, the PRAN system assures safety and reliability.
Flexible Options: Choose from multiple pension fund managers and investment types that best suit your financial goals.
Retirement Security: A disciplined approach to retirement planning ensures financial independence in later years.
The operational and maintenance charges are minimal, thus they are affordable to everybody.
Applying for a PRAN card online is a very simple and easy process. Here are the steps to get started with it:
Visit the Official Website: Access the NPS portal or the website of your chosen Point of Presence (PoP).
Select Subscriber Registration: Click on the "Subscriber Registration" option under the NPS section.
Choose Account Type: Decide whether to open a Tier I account, or both Tier I and Tier II accounts.
Fill in Personal Details: Full Name, Date of Birth, Aadhaar or PAN number and contact details
Uploading the Mandatory Documents: Upload scanned copy of your Aadhaar card, PAN card, and address proof.
Selecting the Fund Manager: Select the Pension Fund Manager (PFM) and the investment choice which can be Active or Auto choice
First Contribution: Contribute at least the amount as prescribed by the NPS guidelines.
E-sign or Authenticate: Sign or authenticate the application through Aadhaar-based OTP or e-signature.
PRAN is issued; After submitting, the PRAN will be generated, and the card will be delivered to your registered address. The subscribers can also save time on paperwork and obtain instant registration through online application.
The PRAN card application process is not complicated; however, a visit to an authorized PoP is necessary. Here's how it goes through:
Step 1: Visit a PoP service provider. It may be a bank or any other financial institution which is registered with NPS.
Step 2: Obtain the NPS subscriber registration form. Use the right variant based on your employment type, whether government, private, or self-employment.
Step 3: Fill the form correctly and accurately with all personal and contact information.
Step 4: Attach self-attested photocopies of KYC documents, which may be Aadhaar or PAN, along with a recent passport-sized photograph
Step 5: Submit the application form and the initial contribution amount payable for Tier I or Tier II accounts.
Step 6: The PoP shall verify all documents attached and process your application
Step 7: Upon successful registration, a PRAN would be generated along with the Card, which shall be sent to your address.
Registration offline is also another good option for those who require personal assistance or are not conversant with the online platform.
PRAN Card Application Form is one of the most important documents in case offline registration is done. The form captures the subscriber's most important information and forms the basis for processing the application.
The form usually consists of the following fields:
Personal Details: Name, gender, date of birth, and marital status.
Contact Information: Residential address, phone number, and email ID.
Nominee Information: Information regarding the nominee to ensure that benefits are passed on in case of unexpected events.
Bank Details: Account number, IFSC code, and bank name for direct debit or auto-pay contributions.
Signature or Thumb Impression: For authentication of the application.
All details must be correct and cross-checked for error before submitting the application.
Age: Indian citizen, 18 to 70 years old.
Employment: Employees in Central and State Government under NPS are automatically eligible for registration. Officers and employees working in Corporate Organizations registered with NPS are eligible to apply.
Self-Employed Individual: Self-employed individuals who want structured retirement planning are eligible for registration.
NRIs: NRIs who wish to invest in NPS can also apply for registration.
Select Mode of Application: Online application through the NPS portal or offline through a PoP
Fill in personal details: name, date of birth, and other relevant information
Submit KYC documents: Aadhaar, PAN, and proof of address
Select type of account: Tier I or both Tier I and Tier II accounts.
Select Fund Manager: Choose a Pension Fund Manager and preferred investment.
First Contribution: Pay the minimum contribution that will activate your account.
PRAN: Upon verification, PRAN will be issued.
A PRAN card is an integral part of the retirement planning framework of India, which enables people with safe and regulated pension solutions. It is not limited to a salaried employee or self-employed professional but even an NRI can have one. This will help people gain financial independence post-retirement, and through its transparency, portability, and flexibility, ensure subscribers are on track to their goals.
Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.
This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.
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A PRAN card (PRAN full form - Permanent Retirement Account Number) is that unique 12-digit number which helps NPS subscribers track and manage their pension contributions. This helps in portability across jobs and locations, providing transparency and seamlessness in retirement planning.
Through the NPS portal or offline from the nearest PoP. You are supposed to submit your KYC documents, select the type of account, and contribute with a minimum amount. In case you are successfully verified, your PRAN card will be sent to you by post.
No, PRAN is for identification of the NPS account, but the PAN is issued for the purpose of taxation, that is, to file returns, and for financial transaction purposes.
The account opening charges are payable once; subsequently, there are an annual maintenance charge and transaction charges, which would hardly pinch a pocket and may vary from CRA to PoP.
NPS is the retirement saving scheme while the unique number that links a person to the scheme to administer contribution and benefits is called PRAN.
Yes, PRAN is compulsory to subscribe to NPS and avail the benefits of tracking contributions, withdrawal, and the funds managed.
Apply online from the NPS portal or offline at a Point of Presence for a duplicate card. The cost is negligible, and it will be dispatched to your registered address.
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