NPS Charges in 2026: What's Changed and What It Means for You

If you have an NPS account, there is a fair chance you have not been tracking every regulatory update PFRDA(Pension Fund Regulatory and Development Authority) has been pushing out. Most people don't. But between October 2025 and now, there have been enough changes to the charge structure that it's worth sitting down and understanding what's actually different, because some of it will affect what you pay, and some of it could save you money over time.

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October 2025: Where It All Started

Everything that's happened in 2026 traces back to a PFRDA circular from September 2025, which came into effect on October 1, 2025. This was the first major overhaul of CRA (Central Recordkeeping Agency) charges since 2020.

For government sector subscribers, the structure became simple and predictable. As of October 2025, opening a PRAN now costs ₹18 for an e-PRAN kit or ₹40 if you want a physical card. The annual maintenance charge (AMC) is ₹100 flat. No transaction fees at all.

Private sector subscribers got a bigger shift. The earlier flat AMC of ₹69 per year regardless of how much or how little was in your account was replaced with a slab-based system tied to corpus size. Smaller accounts now pay less. The ₹3.75 per transaction charge was also scrapped entirely.

January 2026: PoP Fees Come Into the Picture

From January 1, 2026, PFRDA revised what Points of Presence (PoP), the banks and financial firms that manage NPS accounts on behalf of subscribers, can charge.

As of October 2025, for private sector employees under Legal Entities (other than Government), an annual fee of 0.20% of the AUM is now levied. This is adjusted through the NAV and collected quarterly. It's not a huge number, but it's worth knowing it exists. A portion of your NPS corpus is now going towards the cost of account servicing through your PoP every three months.

March 2026: Corporates Get Reclassified

The March 2026 update introduced one of the more significant structural changes to the NPS framework, particularly for employees of PSUs and government-controlled organisations. 

Through a circular dated March 10, 2026, PFRDA split what was previously called the "Corporate Sector" under NPS into two distinct categories: Government Entities and Legal Entities (other than Government).

Government Entities cover statutory bodies, government-owned companies, public sector undertakings, and any other organisations controlled by the Central or State Governments. If your employer falls in this bracket, employees will no longer be onboarded through a PoP; which means no PoP-related charges apply to them. They essentially get treated the same as regular government employees for the purpose of NPS charges.

To get this classification formally, organisations had to submit a certification to their CRA by March 27, 2026. If they missed that deadline, they're automatically treated as Legal Entities and charged accordingly. So if you work for a PSU or a government-backed body and your employer didn't act in time, it could still cost your account more than it should. Worth checking with your HR team if you're unsure.

April 2026: PFRDA Fills In the Gaps

On 29 April 2026, PFRDA issued a clarification circular that filled in several gaps left by the October 2025 framework. The changes come into full effect from July 1, 2026. Before getting into what changed, it helps to understand the two account types this circular directly addresses.

A quick note on Tier I and Tier II

Tier I is the core retirement account. Contributions go here, employer contributions go here, and so do the tax benefits; both on contribution and at maturity. The money is locked in with restrictions on when and how much you can withdraw.

Tier II is a voluntary savings account linked to the same PRAN. No withdrawal restrictions, no tax benefits on contributions (except for central government employees). Many people open it as a flexible investment option, but a large number open it and barely use it. Both sit under the same PRAN but work and are now charged differently.

Tier II Accounts Now Match Tier I

Until now, there was no clear rule about how Tier II accounts should be charged relative to Tier I. Different CRAs handled it differently. That inconsistency ends from July 2026; Tier II AMC will now follow the same rate as Tier I under the same sector. The one exception: if your Tier II balance is ₹1,000 or less at the end of a quarter, no AMC is charged at all.

Each Scheme Inside Your PRAN Charged Separately

If your PRAN holds multiple pension schemes, each one will now be treated as its own account for AMC purposes. This adds a layer of clarity; you'll know exactly what you're paying for each scheme, rather than having it bundled together in a way that wasn't always transparent.

Dormant Accounts: 90% Fee Reduction

This is honestly the most practical change in the whole set. If you have an old NPS account from a previous job that you've stopped contributing to, those accounts will now only be charged 10% of the standard AMC instead of the full amount.

An account is considered dormant if it hasn't received any contribution for four consecutive quarters and has been flagged inactive by the CRA. The moment you make a contribution again, it becomes active the following quarter. So the protection comes in automatically and you don't need to do anything. For anyone carrying a forgotten NPS account from an old employer, this is real money saved over the years.

PRAN Opening Charge: One-Time Only

PRAN opening fees now apply only when a PRAN is generated for the very first time. If you later want to add a Tier I or Tier II account to an existing PRAN, there's no additional opening fee. Simple, and fair.

APY and NPS Lite: Nil Balance, Nil Charge

Under Atal Pension Yojana and NPS Lite both designed for low-income and informal sector workers, accounts with a zero balance will not attract any AMC. This was never the right place to be collecting maintenance fees, and the clarification makes that official.

What Should You Actually Do?

If you work for a PSU, statutory body, or government-controlled organisation, it is worth checking whether your employer has been classified as a Government Entity under the March 2026 framework, since that determines whether PoP-related charges apply to your NPS account 

If you are in the private sector, find out whether your employer has been reclassified as a Legal Entity after the March 2026 circular. It changes what you pay.

If you have an old NPS account sitting idle, the 90% AMC reduction from July 2026 means holding on to it costs far less. You might want to check its balance and decide whether to reactivate it or eventually consolidate.

And if your Tier II account doesn't have much in it, you may already be exempt from AMC going forward.

None of this is dramatic. But pension savings work for decades, not months and charges that seem small today eat into your retirement corpus in ways you only notice much later. Knowing the rules is the first step to making sure you're not paying more than you need to.