Who will get money if someone changes NPS nomination using login credentials of a deceased subscriber?

Any change in nomination after the death of the subscriber using his login credentials would be deemed invalid and the amount would be settled in favour of legal heirs. In a recent circular, the Pension Fund Regulatory and Development Authority (PFRDA) issued some clarifications for the benefit of NPS intermediaries associated with NPS exit processing.

“Nomination can be made only by the subscriber. However, there are special provisions enabled as per exit regulations for treating the nomination as made in the service records to protect the interest of the subscribers who were employed and covered under NPS through their employers,” PFRDA said in the circular dated 20th October 2022.

The regulatory made the following clarifications:

1. Any changes in the nomination post-death of the Subscriber using the deceased subscribers’ login credentials shall be treated as invalid. A nomination is valid if it fulfils the rules defined by PFRDA as provided in its exit Regulations.

2. In all such cases with invalid nominations, the valid nomination made by the subscriber before death will be considered for claim processing.

3. In case of invalid nominations, the claims need to be processed by the respective intermediary and the eligible corpus has to be paid to the legal heirs.

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4. In the case of subscribers covered under Govt and Corporate sectors where no valid nomination exists in accordance with exit regulations: PFRDA said that at the time of exit of such subscriber on account of death, “the nomination, if any existing in the records of such subscriber with his or her employer for the purpose of receiving other admissible terminal benefits shall be treated as nomination exercised for the purposes of receiving benefits under the NPS as per the provisions of Exit Regulations 32(xii).”

5. In the case of subscribers under UOS: Any changes in the nomination post-death of the subscriber using the deceased subscribers’, login credentials will be treated as invalid and the amount will be settled in favour of legael heirs.