A Detalied Guide On How To Unfreeze NPS Account?

NPS (National Pension Scheme) is a well-known retirement benefit system in India. If you start investing in NPS during your early career, you will need proper expenditure planning as you have to contribute a minimum amount regularly. If you do not meet the minimum requirements or submit the wrong documents, your NPS account can be frozen indefinitely. 

Are you stuck logging into your NPS account? If yes, the possible reason is your account is frozen. Continue reading this blog to learn how to unfreeze an NPS account, why your account could be frozen, tips to prevent this and more. 

Reasons for NPS Account Freezing

There can be several underlying reasons for NPS account freezing. This is the very first thing every NPS subscriber wonders when coming to know that their NPS account is no longer active. This section will provide you with detailed possible reasons for freezing an NPS account.

As per the guidelines set by the Pension Fund Regulatory and Development Authority (PFRDA), every NPS individual must contribute a minimum amount to their NPS accounts yearly. In cases, when an individual fails to contribute to their account, the account will freeze and no further transactions will take place in the account. 

However, the norms for minimum contribution vary for both Tier I and Tier II account holders. Here are the possible reasons for an NPS account to freeze:

• Minimum Contribution: Tier I account opening takes place with at least Rs. 500 and individuals must deposit at least Rs. 6,000 every year to keep the account active. However, there is no requirement for a minimum amount of deposition for a Tier II account. 
  Once your Tier 1 account freezes, your Tier II NPS account also becomes inactive. The main reason behind an NPS account deactivation is the failure to meet stated minimum contributions. However, freezing of NPS account intimation mail is sent through email. 
• KYC Compliance: Not complying with KYC norms will not lead to your NPS account freezing. Rather, if your KYC documents are submitted, but approval is pending, it will lead to the freezing of your account. 
• Submission of Membership Form: NPS subscribers can subscribe through online mode but still they need to send the physical form to POP-SP (Point of Presence Service Provider) or CRA, as per the case. Non-submission of membership forms will freeze your account. 

Consequences of NPS Account Freezing

There are several ways to unfreeze your deactivated NPS account. The first and foremost option is to unfreeze the account online by paying the minimum contribution and penalty. The second option is to unfreeze your NPS account offline through a bank branch. 

How to Check If Your NPS Account is Frozen?

Before proceeding to unfreeze your account, you need to make sure it's frozen or has become inactive. Before this happens, you will receive several warnings. 

You will receive an error message stating your ineligibility towards the minimum amount of contribution in the account. Apart from this, being an NPS subscriber, an SMS will be sent warning your account could get frozen if the necessary steps are not taken within 30 days. Once the status of your account changes from active to frozen, another SMS or email will be sent to you. 

Moreover, if you have overdue debts, creditors may freeze your NPS account and collect the dues directly from your bank. When you fail to withdraw money or transfer funds from your account, it means your account is frozen. 

If the following circumstances take place, it indicates that your bank account is frozen:

• You have no access to your money.
• You are unable to use your ATM or debit card.
• No transfer or electronic payments are allowed.
• Checks written with your funds are not cleared.

In other words, any kind of transaction attempted from your end will turn out unsuccessful if you have a frozen account. 

Apart from this, the bank will also send a notice about your frozen account. Even though the bank notifies you of a deactivated account, it will comply with the order before letting you know. Hence, you need to check the official portal to know why your account was frozen. 

Ways to Unfreeze NPS Account

The Pension Fund Regulatory and Development Authority (PFRDA) can freeze your NPS account because of several underlying reasons. However, to keep your planning of retirement on track, it is necessary to reactivate your NPS account. 

Make sure to follow the below-mentioned steps to learn about how to unfreeze your NPS account:

• Making the Minimum Contribution Online: To make a minimum contribution online, visit the eNPS portal and go to the contribution page. Make sure to make a minimum contribution of Rs. 500 per month for the time your account was frozen. You will also have to pay a penalty. 
  You will receive payment confirmation via email and your NPS account will unfreeze. Once completed, you can make regular yearly contributions by logging into the account. 
• Making an Offline Contribution: It is possible to reactivate your account offline via a bank or Point of Presence (PoP) facility. Make the required contribution by visiting your nearest PoP and unfreezing your NPS account. You must submit a DD or cheque in favour of the PoP agency. Once you contribute the required amount, your NPS account will get registered with the PRAN mentioned on the NCIS. 
• Deal with KYC Rejection: If your KYC is rejected or approval is pending, your NPS account can become frozen. If you are facing KYC rejection, follow the below-mentioned steps to unfreeze the NPS account:

1. Get the registration form, attach your picture and sign on it.
2. Visit the nearest PoP for physical verification along with verification of your PAN details, identity and address.
3. Fill up all the details and complete the registration form, sign it and put a stamp on it. The registration form however must include the employee ID.
4. After successful verification, submit the form at the PoP.

Once you update all the details, your PRAN will be reactivated. You will also receive confirmation via email and you can start your yearly minimum contribution to secure your future. 

How to Unfreeze an NPS Account Online?

Opting to unfreeze the NPS account online is probably the simplest way. Digital platforms are a convenient way to carry out things hassle-free.

Follow the below-mentioned steps and learn how to activate a frozen NPS account online:

1. Visit the eNPS portal and enter valid credentials to log in to your NPS account.
2. Click on the ‘Contribution’ option located on the top menu.
3. Enter all mandatory details such as PRAN details, type of NPS subscriber and date of birth.
4. Initiate the minimum contribution of Rs. 500 on the following page.
5. You will receive an OTP. Enter the OTP and security to submit your application.
6. You will receive a confirmation of your payment and the same will be notified also at your registered email ID.

The account will thereafter unfreeze successfully and you can start making contributions henceforth for your retirement planning. 

How to Unfreeze NPS Account Offline?

POP-SP entities located all over India undertake the process of unfreezing NPS accounts offline. Locate the nearest POP-SP in your area to ease your unfreezing.  

Below are the various solutions that will help you to understand how to unlock your NPS account offline:

• Minimum Contribution: Every individual must make a minimum deposit of Rs. 6,000 at least once in a financial year. Fill out the PFRDA unfreeze request Form UOS-S10 and submit the same to the representative at the POP-SP. Here are the important points you need to remember while making the minimum contribution:
  • Along with the form attach a copy of your PRAN card.
  • Deposit a minimum amount of Rs. 500/month with a penalty of Rs. 100 over the period of frozen account.
  • You can submit the contribution amount via cash, cheque or a demand draft using the NPS Contribution Instruction Slip (NCIS).
  • The amount gets credited to your account via the POP-SP and the outcome is uploaded into the CRA system.
  • CRA is solely responsible for freezing and unfreezing NPS accounts.

Once approved, your NPS account will be activated. An activation intimation email will be transmitted to your registered email. 

• Pending KYC Compliance: As an NPS subscriber, it is mandatory to submit all relevant KYC documents. At times, even though complying with the KYC norms, verification is delayed at the POP-SP. For this, your NPS account status stays inactive. Henceforth, you must follow up with the POP-SP to unfreeze your NPS account sooner.
• Membership Form Submission: Your NPS account may get inactivated because of non-submission of the NPS form. So, you must comply with this requirement. It is mandatory to fill up the membership form and make it reach the CRA to activate your account, irrespective of whether you have joined the NPS through POP or other intermediaries. Your account will be reactivated within a few days from your submission date of the membership form. 
• Deficient KYC Documents: At times, your KYC documents might leave you unverified while you enrol for NPS membership. The main reason behind this might be the missing or invalid documents. In this scenario, you must take the initiative to find the deficiency and submit all relevant documents to POP-SP. The service provider will verify and unfreeze your NPS account.
• KYC Rejection: At times, any intermediary bank might reject all your KYC documents for various reasons. Thus, make sure to submit all valid KYC documents for smooth verification. Once you receive approval of all KYC documents your NPS account will unfreeze.

How Much Time Does It Take to Unfreeze NPS Accounts?

An NPS subscriber must fill up the form and submit it to the POP-SP or the CRA. They will take the initiative to activate your account. The NPS account will unfreeze within a few days from your date of submission of the form.

Penalty for Frozen NPS Account 

The Pension Fund Regulatory and Development Authority (PFRDA) charges a penalty of Rs. 100 for both subscribers belonging to Tier 1 or Tier 2 or both accounts. For regular accounts, the deposit amount required is Rs. 500/month for the current fiscal year along with a penalty of Rs. 100 for the year of your frozen NPS account.

 If the amount of contribution is less than the minimum expected amount, CRA rejects the contribution during the process of uploading. 

Final Words

By now, you must have a clear understanding of how to unfreeze an NPS account. Subscribing to an NPS account fulfils the financial long-term objectives and also helps to secure your retired life. There can be various deficiencies that lead to the inactivation of your NPS account and thereby impact your corpus health. You must identify the reason promptly and find out ways of unfreezing your account. 

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