To keep a Tier I account active, the minimum contribution for each financial year has been reduced to R1,000 from R6,000. This will be applicable for NPS private sector — all citizen model and corporate model.
For Tier II accounts, the pension regulator has waived the minimum requirement of contribution of R250 per annum and maintaining a minimum balance of R2,000 at the end of the financial year.
In a Tier II account a subscriber can withdraw money at any point of time without any restriction or penalty. Contributions towards the Tier II account can be made using the PRAN and a subscriber can choose between equity funds, government securities and fixed income instruments.
As a one-time measure all accounts under Tier I and Tier II frozen in the past due to non-compliance of minimum contribution of R6,000 per annum in Tier I account and minimum contribution of R250 per annum in Tier II account and the minimum balance requirement of R2,000 at the end of the financial year in Tier II account in the CRA system is being unfrozen.
All these subscribers can now make contribution to their NPS account in a normal way without the necessity of using UOS-S10A form. It is a form used by subscribers to request for unfreezing of Permanent Retirement Account Number (PRAN) under NPS.
While the minimum balance requirement for keeping the account active has been reduced, the regulator has advised subscribers to contribute to their PRAN as much as possible so as to get a decent pension and live a dignified life after retirement.