Pension Schemes in India — APY, NPS & EPFO Guide (2026)

India operates a tiered pension architecture for different segments — central and state government employees, organised private sector workers, unorganised workers, and self-employed citizens. Understanding each scheme helps you plan retirement security.

National Pension System (NPS)

NPS is a market-linked, defined-contribution pension scheme regulated by PFRDA. It is mandatory for central government employees joining service after 1 January 2004 (similar dates for state governments) and voluntary for private sector and self-employed citizens above 18.

NPS Tier I and Tier II

• Tier I — Retirement account, withdrawal allowed only at 60 or for specified emergencies, tax benefits up to ₹2 lakh under Sections 80CCD(1B) and 80CCD(2)
• Tier II — Voluntary savings account, withdrawal anytime, no lock-in, no tax benefits (except for central government employees with 3-year lock-in)

Atal Pension Yojana (APY)

APY targets unorganised workers aged 18–40. Subscribers contribute fixed monthly amounts (₹42 to ₹1,454 depending on age and pension target) for a guaranteed monthly pension of ₹1,000 to ₹5,000 after age 60. APY is regulated by PFRDA and serviced through banks.

Employee Provident Fund (EPF)

EPF is administered by the Employees' Provident Fund Organisation (EPFO) under the EPF and Miscellaneous Provisions Act, 1952. Coverage is mandatory for establishments with 20 or more employees. Both employer and employee contribute 12% of basic salary plus DA. EPF balance can be withdrawn at retirement or for specified emergencies.

EPF withdrawal rules

• Full withdrawal allowed at retirement (age 58)
• 75% withdrawal after one month of unemployment
• 100% withdrawal after two months of unemployment
• Partial withdrawal for marriage, education, medical treatment, home purchase, home repair
• Pension (EPS) component withdrawal subject to service length

Employees' Pension Scheme (EPS)

Part of EPF contribution (8.33% of basic up to wage ceiling of ₹15,000) is diverted to EPS, which provides monthly pension after age 58. The pension is calculated based on pensionable service and salary, with a minimum of ₹1,000 per month under recent notifications.

Central Government Pension (Old Pension Scheme)

Employees recruited before 1 January 2004 are covered under the Old Pension Scheme, which provides 50% of last drawn basic pay as pension (plus DA). Several states have recently announced restoration of OPS for state government employees.

Indira Gandhi National Old Age Pension Scheme (IGNOAPS)

IGNOAPS provides ₹200–₹500 per month (state top-ups vary) to BPL persons aged 60 and above. The scheme is administered by states under the National Social Assistance Programme (NSAP). Apply at the Tehsildar or Gram Panchayat office.

How to enrol in NPS

Visit any Point of Presence (PoP) — banks, post offices, online portals like NPS Trust, Karvy, NSDL e-Gov — and submit Aadhaar, PAN, photograph, and a small first contribution (₹500 minimum for Tier I). PRAN (Permanent Retirement Account Number) is issued within 7 days.