NPS is available in

• Tier I
  • Tax free 14% of Basic + DA salary, limited to 7.5L annually
• Tier II
  • This is just a cheap mutual fund (ie lower expense ratio)

Features

• You can opt for auto scheme which changes allocation based on age, i.e, shifts assets from equity to debt etc.
• It has the lowest expense ratio in the industry
• Allows you to change Fund Manager, once a year, without any tax
• Allows you to change your asset allocation, once every quarter

Multi scheme

With multi scheme you can decide explicitly the funds you want to allocate. Also you can go 100% equity with this. The only drawback is once a amount is invested in a fund, you have to stay invested for entire duration (15 years). You can change allocation for next month. But old amount cannot be rebalanced. Although, you can shift the entire amount back to auto schemes.

Withdrawal

With recent changes, you can withdraw from the scheme after 15 years or at age 60, which ever is earlier.

• 80% of the amount is available as Lump Sum
• For the remaining 20% you've to purchase annuity

There's also a scope of withdrawing via SWP instead of entire amount at once.

You can take loan against your NPS corpus.

Sources

• https://youtu.be/y0OhXSjcbkI?si=_C8tQRymXuskPaME

Related

• income-tax
• epf