What is NPS Vatsalya Scheme? Know who can invest and how

Updated: 18-02-2026, 06.07 PM

What is the news?

Many people want to create a big fund with a small amount for the secure future of their children, then the government’s ‘NPS Vatsalya’ scheme can be a better option for them. Investing in it for a long time gives the benefit of compounding. If you deposit Rs 10,000 every year in the name of the child, then by the time he turns 60, a fund of up to Rs 11 crore can be created. Let us know how to invest in this scheme.

What is NPS Vatsalya Scheme?

This is a new scheme of the government National Pension System (NPS), which was launched in September, 2024. Parents can invest in the scheme in the name of their child below 18 years of age. In this, it is necessary to deposit at least Rs 250 annually, there is no maximum limit. This account will convert into regular NPS pension account as soon as the child turns 18 years of age. Parents can choose investment options as per their choice.

There are 3 options available for investment

This scheme offers 3 investment options and parents can decide how much money to invest in equity, debt or government bonds. In the aggressive option, 75 percent is invested in equity. In this both risk and return are high. Moderate is where 50 per cent is invested, in which the risks and returns are moderate. The conservative option invests 25 per cent in equities and has lower risks and returns.

When can you withdraw money?

After 3 years from account opening, you can withdraw up to 25 percent of the investment amount for education, treatment or notified disabilities. Withdrawal is allowed 2 times before 18 years, 2 times between 18-21 years. If the fund is more than Rs 2.5 lakh, then 20 percent can be withdrawn in lump sum. If the fund is Rs 2.5 lakh or less, you can withdraw the entire amount in lump sum. If anything happens to the child, the guardian will get the entire money.

Process

You can open an account in this way

NPS Vatsalya account can be opened by visiting the bank. Online account can be opened at https://nps.kfintech.com/ or other eNPS platforms while sitting at home. Any Indian whose child is below 18 years of age can invest in this scheme. For this, it is necessary for the child to have PAN and Aadhar card. A minimum investment of Rs 250 will have to be made annually. In this, interest of 9.5-12.86 percent is available annually.