NPS vs UPS: Central government employees now have a one-time switch facility available- check details

The government has introduced a one-time, one-way switch facility for central government employees to move from the Unified Pension Scheme (UPS) to the National Pension System (NPS), with a deadline of September 30, 2025.

According to a notification issued by the finance ministry, employees can exercise the switch option up to one year before their date of superannuation, or three months before the deemed date of retirement in case of voluntary retirement, ET reported.

The notification said that similar provisions would apply in cases of resignation or other circumstances with minor modifications if needed. However, the switch will not be permitted in cases of dismissal, removal, compulsory retirement as a penalty, or where disciplinary proceedings are pending or contemplated.

Once the switch is exercised, the provisions of the PFRDA (Exit & Withdrawal under NPS) Regulations, 2015 will apply, and the employee will cease to be eligible for assured payouts and other UPS benefits, the notification said.

It added that the government’s differential contribution of 4% under the default investment pattern will be calculated and credited to the employee’s NPS corpus at the time of exit.


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