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Investing

NPS Vatsalya: How to Open a Pension Account for Your Child

Parents can open NPS Vatsalya for a child under 18 through eNPS or a bank with ₹250. The account moves to the child at 18.

PN

Written by Priya Nair

Published 25 September 2026·7 min read

On this page10 sections
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A parent or legal guardian can open an NPS Vatsalya account for any Indian citizen under 18, online through eNPS or at a bank or post office that acts as an NPS Point of Presence. You need ₹250 to start. The account is in the child’s name, gets its own PRAN, and follows PFRDA’s NPS Vatsalya Scheme Guidelines 2025, in force since 23 February 2026.

Key facts

Item Rule
Who it is for Indian citizens below 18, including eligible NRIs and OCIs
Who opens and runs it A parent or legal guardian, until the child turns 18
Minimum contribution ₹250 at opening, ₹10 per later payment, ₹250 in each financial year
Maximum contribution No limit
Partial withdrawal After 3 years, up to 25% of contributions (not returns), for education, specified illness or disability above 75%
At 18 Fresh KYC; then continue up to 21, move to regular NPS, or exit
Exit lump sum Full corpus if below ₹8 lakh; otherwise up to 80%, with at least 20% in an annuity
Tax deduction Up to ₹50,000 for the parent, old tax regime only
Regulator Pension Fund Regulatory and Development Authority (PFRDA)

What changed in 2026

PFRDA issued the NPS Vatsalya Scheme Guidelines 2025 on 7 January 2026. They replaced the September 2024 scheme details and took effect on 23 February 2026. The main changes:

  • The minimum yearly contribution fell from ₹1,000 to ₹250.
  • At exit, the child can now take up to 80% as a lump sum. The old rule required at least 80% to go into an annuity.
  • The full-withdrawal limit rose from ₹2.5 lakh to ₹8 lakh.
  • Partial withdrawals before 18 were cut from three to two, and two more are now allowed between 18 and 21.

Some NPS Trust pages and its FAQ PDF still show the older ₹1,000 and ₹2.5 lakh figures. The PFRDA guidelines prevail.

Who can open it and documents needed

The child must be an Indian citizen below 18. A parent or court-appointed legal guardian opens the account, and only one account is allowed per child. The guardian is the nominee until the child turns 18. The guardian does not need an NPS account of their own. A grandparent can open one only if they are the child’s legal guardian.

Keep these ready:

ItemDetails
Child’s date of birth proofbirth certificate, school leaving certificate, matriculation certificate, PAN or passport.
Guardian’s KYCAadhaar, driving licence, passport, voter ID, NREGA job card or National Population Register document.
Guardian’s PAN, or a Form 60 declaration.
Court orderappointing the guardian, if a legal guardian is opening the account.
Bank accountthe child’s own or joint account is optional for residents at opening, but needed for any withdrawal. NRI and OCI cases need an NRE or NRO account from the start.

How to open NPS Vatsalya online through eNPS

  1. Go to the Open NPS Vatsalya page on npstrust.org.in and pick a Central Recordkeeping Agency (CRA). You can also go straight to the Protean eNPS site.
  2. Under National Pension System, choose NPS Vatsalya (Minors) and then Registration.
  3. Enter the guardian’s date of birth, PAN, mobile number and email, then click Begin Registration.
  4. Pick a KYC method, Aadhaar or Document with DigiLocker, accept the terms and click Generate OTP.
  5. Enter the OTPs sent to the mobile number and email, and click Confirm.
  6. Fill in the child’s details as the form asks.
  7. Choose a pension fund, and add bank details if you have the child’s account.
  8. Enter the first contribution of ₹250 or more, click Proceed and pay online.
  9. Once the account is opened, the CRA issues a PRAN in the child’s name.

These screen names follow Protean’s own walk-through and may vary slightly between CRAs.

Opening at a bank or post office

Banks, India Post and pension funds registered as Points of Presence (PoPs) can open the account. Collect the NPS Vatsalya form at the branch, attach the documents above and pay the first contribution by cheque or cash. NPS Trust publishes the list of registered PoPs. The PoP charges its fee as set by PFRDA for the All Citizen model.

Contributions and investment choices

You can pay as often as you like through the PoP, its app or website, eNPS or UPI. Relatives and friends can also gift money into the account. If you miss the ₹250 minimum in a year, the account does not close by itself.

The guardian picks one PFRDA-registered pension fund and can change it once a financial year. The fund may run its own mix with up to 100% in equity, as under the Multiple Scheme Framework. The alternative is an indicative pattern capped at 75% equity, 20% government securities, 30% debt and 10% money market. Returns are market-linked and not guaranteed.

Use the NPS calculator to estimate how regular contributions could grow over the years until your child turns 18.

Partial withdrawal before 18

  • Allowed only after the account has been open for three years.
  • Permitted purposes: the child’s education, treatment of specified illnesses, or disability of more than 75%.
  • Up to 25% of the money paid in, excluding returns, on a declaration basis.
  • At most two withdrawals before 18, and two more between 18 and 21 after KYC.
  • The money goes to the child’s own or joint bank account.

What happens when the child turns 18

Control passes to the child after fresh KYC and nominee details. Until that is done, no withdrawals are allowed, though the money keeps earning returns. The child then has three choices:

Option What it means
Stay in NPS Vatsalya Continue under the scheme up to age 21
Move to NPS Shift the full corpus to the All Citizen model of NPS
Exit Withdraw everything if the corpus is below ₹8 lakh; otherwise take up to 80% and put at least 20% into an annuity

If no choice is made by 21, the account moves to the high-equity scheme of the same pension fund under the Multiple Scheme Framework. From then on, the regular NPS exit rules apply. Our NPS guide explains those rules and the All Citizen model.

If the child dies, the full balance goes to the guardian, nominee or legal heirs. If a guardian dies, another guardian must register with fresh KYC.

Tax treatment

Stage Old tax regime New tax regime
Contribution by parent or guardian Deduction up to ₹50,000 under Section 124(4) of the Income-tax Act, 2025 (Section 80CCD(1B) of the 1961 Act) No deduction
Partial withdrawal (up to 25% of contributions) Exempt Exempt
Lump sum at exit Exempt up to 60% of corpus Exempt up to 60% of corpus
Amount used to buy an annuity Exempt at purchase Exempt at purchase
Amount paid on the child’s death Not income of the recipient Not income of the recipient

This follows PFRDA’s summary for the Income-tax Act, 2025, which applies from tax year 2026-27. If you also claim the ₹50,000 deduction for your own NPS, a tax professional can confirm how the two claims interact.

NPS Vatsalya can run alongside a Sukanya Samriddhi Yojana account for the same child.

Frequently asked questions

What is the minimum amount for NPS Vatsalya?

₹250 to open the account and ₹250 in each financial year. Later payments can be as small as ₹10, and there is no upper limit.

Can grandparents open an NPS Vatsalya account?

Only if they are the child’s legal guardian. Grandparents, relatives and friends can still gift contributions to an existing account.

Can NRIs open NPS Vatsalya for their child?

Yes. Eligible NRI and OCI minors can join, but an NRE or NRO bank account must be given at opening.

Can I withdraw from NPS Vatsalya before 18?

Yes, after three years, up to 25% of contributions, for education, specified illness or disability above 75%. Only two such withdrawals are allowed before 18.

What happens if the child does nothing at 18?

The account continues without withdrawals until KYC is done. If no option is chosen by 21, it moves to a high-equity NPS scheme of the same fund.

Is NPS Vatsalya tax-free?

Partial withdrawals and up to 60% of the exit lump sum are exempt. The parent’s deduction of up to ₹50,000 is available only under the old tax regime.

Can I change the pension fund?

Yes, once in a financial year.

Sources

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