Systematic Lumpsum Withdrawal (SLW) in NPS | HDFC Pension

Systematic Lumpsum Withdrawal (SLW) in NPS


Extract of recent PFRDA Circular No.: PFRDA/2023/30/SUP-CRA/10 dated 27th Oct 2023.

“In accordance with regulation 3 and regulation 4 of PFRDA exit and withdrawal under NPS regulations 2015 and it’s amendments there in, it is proposed to provide the option of phased withdrawal of the lump sum through systematic Lump sum withdrawal (SLW) facility. The subscribers are allowed to withdraw up to 60% of their pension corpus, through SLW on periodical basis Viz monthly, quarterly, half yearly or yearly for a period till 75 years of age as per the choice at the time of the normal exit.”


What are the changes in existing deferment guidelines that SLW (Systematic Lump sum Withdrawal) facility has brought for NPS Subscribers?

Existing Guidelines:

  • Subscriber on attaining age 60 or on superannuation can defer availing of annuity or withdrawal or both in any combination till 75 yrs of age.
  • The lumpsum amount can be withdrawn fully in a single tranche (one time), or on an annual basis.
  • If withdrawn annually, subscriber has to initiate the withdrawal request every time and get it authorized.

New Guidelines:

  • With SLW facility, the lump sum corpus (i.e. upto 60% of pension Corpus) can be withdrawn in a phased manner
  • Subscriber has an option to withdraw desired amount systematically at regular periodic intervals i.e. monthly, Quarterly, Half yearly or annually (currently only annual option available in existing guidelines)
  • It is allowed till age of 75 years (same as earlier guidelines)
  • Only one time request required i.e. no need to submit request every time you withdraw . This is similar to Systematic Withdrawal Plan under Mutual Funds
  • It is applicable at the time of superannuation or attaining age of 60 yrs (same as earlier guideline)


  • SLW is not applicable for Pre mature exits. It’s applicable to Lumpsum Pension Corpus only for exit at 60 years of age or at Superannuation
  • Taking Annuity on Superannuation/60 years is still mandatory. A minimum of 40% or more of Corpus has to be mandatorily invested in annuity.



  • What are the benefits to Sales / FLS?

One more point to engage with Customer. Help company and customer preserve their Fund. The regular cashflow of SLW can be used for Upsell into a LI Policy.

  •  Can I withdraw my lump sum if I need it at a later date?

Yes, by terminating your SLW request

  • Can I withdraw part lump sum and with rest of the corpus start SLW at the time of superannuation/60 yrs?

No, part withdrawal or part SLW is not allowed.

  • Can I switch between asset classes post starting SLW?


  • What are the various SLW options?

Protean has two options:

  1. SLW tenure based on age: customer has to provide for start date and Frequency, amount will be auto populated
  2. SLW tenure based on installment amount: customer has to enter installment amount, SLW date and frequency. Start and end date of the SLW will be auto calculated

KFINTECH has one option:

  1. Mention SLW amount, frequency and start date
  • Will there be an impact on Annuity business?

No, Annuity has inherent good features like Guaranteed income for the rest of the life (for self or for family – as per the option chosen). SLW is maximum till 75 years whereas Annuity is for life.

  • Will fresh contributions be allowed during SLW period?

No. Subscriber cannot contribute further once SLW starts.

  • How will exit process change? Will it become more difficult?

CRA’s have already developed their system on SLW. The process is online and easy to operate. KCRA and PCRA’s process details are attached separately.

  • What should be the ideal pitch to the customer?

Invest as much as possible in annuity (min. 40%) as this will give Guaranteed regular income for life. If customer needs flexibility, can opt for SLW (requirements can differ from customer to customer)


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