NPS account or National Pension Scheme is a Market-linked account that will help you in earning a good profit for your investment. This scheme is for long-term investments, especially retirement funds.
In this scheme, the amount which you will invest will be invested in the market and the returns which your investment made will be reflected at the time of maturity.
In a country like India, which is the third largest economy (PPP) and 5th largest economy by Nominal GDP it is a very attractive investment tool.
You can expect your investment to be 10x or even 20x growth because of the booming economy and India’s Younger population.
From the PPF account, which is a more traditional investment account where you’ll receive fixed returns, the NPS account has a much higher yield and CAGR. Hence, a young individual must invest in a tool like NPS.
You can open an NPS Account in various banks including the Government of India Banks. UCO Bank is one such bank account where you can open the NPS Account.
In this article, we will discuss How to Open an NPS Account in UCO Bank, Documents Required, Pension Fund manager, Investment strategy, etc.
Table of Contents
Eligibility for NPS Account
The following are the eligibility criteria for opening the NPS Account-
- The subscriber must be a citizen of India
- The age of the subscriber must be between the age of 18 years to 60 years
- The documentation mentioned below is required for opening the NPS account in UCO Bank
Types of NPS Account
There are two types of NPS accounts where you can invest. The following are the details related to the types of NPS accounts-
Tier-I
- This is a compulsory account that you’ll have to invest in if you are opening the NPS Account
- The investment you make in this account is non-liquid meaning you cannot take out the funds
- You can get a tax benefit of Rs.1.50 lakhs by investing in this account along with Rs.50,000/- additional benefits
Tier-II
- It is an optional account, you may and may not apply to open this account
- In this account, you can invest the fund as well as dilute the funds wherever you want
- There are no tax benefits for investing in this account
Returns of NPS Account in the year 2021
The following are the returns
Tier-I
| Pension Fund Managers | Returns* | |||
| 6-month | 1-year | 3-year | 5-year | |
| HDFC Pension Fund | 9.16% | 9.56% | 14.72% | 11.90% |
| UTI Retirement Solutions | 7.71% | 8.77% | 13.50% | 11.85% |
| SBI Pension Fund | 8.26% | 9.73% | 13.49% | 11.38% |
| ICICI Pension Fund | 9.56% | 9.30% | 13.11% | 11.12% |
| Kotak Mahindra Pension Fund | 9.30% | 9.28% | 13.00% | 11.12% |
| Reliance Pension Fund | 7.51% | 9.15% | 12.05% | 10.32% |
| LIC Pension Fund | 7.07% | 8.13% | 11.86% | 10.22% |
| Aditya Birla Pension Fund | 6.22% | 7.12% | NA | NA |
Tier-II
| Pension Fund Managers | Returns* | |||
| 6-month | 1-year | 3-year | 5-year | |
| HDFC Pension Fund | 9.20% | 9.47% | 14.87% | 11.50% |
| UTI Retirement Solutions | 7.54% | 9.39% | 13.66% | 11.96% |
| SBI Pension Fund | 8.24% | 9.71% | 13.50% | 11.39% |
| ICICI Pension Fund | 9.64% | 9.32% | 13.16% | 11.14% |
| Kotak Mahindra Pension Fund | 9.29% | 9.54% | 13.03% | 11.12% |
| Reliance Pension Fund | 7.34% | 8.94% | 12.08% | 10.32% |
| LIC Pension Fund | 6.83% | 8.51% | 11.74% | 8.97% |
| Aditya Birla Pension Fund | 5.81% | 6.61% | NA | NA |
How to Open an NPS Account in UCO Bank?
You can follow these steps to open the NPS Account in UCO Bank-
- Visit the official website of the UCO Bank NPS Account and click on the NPS Registration button
- You’ll be redirected to a new page where you’ll have to click on the registration button again
- Now, a small form will appear which you’ll have to fill with details like registration number, application type, Aadhar Card number, etc. followed by clicking on the continue button
- After filling out the application form, an OTP will be sent from your registered mobile number which you’ll have to enter
- Now, a form will appear where you’ll have to fill out the application form with details like name, address, contact details, nominee details, etc.
- After filling out the form, click on the generate acknowledgment number. Make sure to keep the number safe with yourself
- Now, you’ll have to choose the pension fund manager from the given list
- After that, you’ll have to upload the below-mentioned documents into the application form
- Now, click on the pay button and deposit the initial deposit amount that you want to invest in the account
- Now, you’ll get the PRAN number which you can use to access your account
- Now, you’ll have to e-sign in using your Aadhar number
- After successfully signing in, you’ll be able to use your NPS Account easily
Documents Required for opening NPS Account
The following are the documents required for opening the NPS Account-
- Scanned Photograph of the applicant
- Scanned photograph of the signature
- Aadhar Card
- PAN Card
- Mobile number (registered with Aadhar and Bank)
- Email ID
Pension Fund Manager
Pension Fund managers are those institutions that will be responsible for managing your investment. The institution will analyze the market and try to invest in quality stocks where they can find maximum yield.
By default, the pension fund manager is the State bank of India Pension Fund Manager and if you do not change the fund manager, the SBI will be automatically given the responsibility of managing your fund. The following are the list of pension fund manager which you can choose from-
- LIC Pension Fund Limited
- SBI Pension Funds Private Limited
- HDFC Pension Management Company Limited
- ICICI Pension Fund Management Company Limited
- UTI Retirement Solutions Limited
- Kotak Mahindra Pension Fund Limited
- Reliance Capital Pension Fund Limited
- Birla Sunlife Pension Management Limited
How to Choose the Investment Strategy?
Investment Strategy is the strategy that you want to instruct the pension fund manager to follow. You can adopt three different strategies depending on the risk and age criteria. Basically, there are three different types of investment options- Government Bonds, Corporate Bonds, and Stock investments with the lowest to higher risk factors respectively.
If you are younger, then you can be an aggressive investor and can take a higher risk so investing in more stock and fewer bonds might increase your CAGR.
If you want to reduce your risk then it is recommended that you should invest more in bonds especially Government Banks and less in Stocks.
You can adjust your investment from time to time and can also change your Pension Fund manager whenever you want.
FAQ
Yes, if you are an Indian non-resident citizen then also you can invest in the NPS account easily.
There are no such upper limits for the investment into the NPS account.
Yes, you can still invest in the NPS account as the investment made in this account does not affect any of your other investments.
No, you cannot invest in more than one NPS Account. Any other account in your name will not be opened or even if it is opened, your investment will not be appreciated you’ll only receive the principal amount.
I’m Shiv Kumar, a graduate with a passion for finance, marketing, and technology. My journey into finance started with a desire to understand money management and investing.
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