The Pension Fund Regulatory and Development Authority (PFRDA) has announced changes to the fee structure for the National Pension System (NPS) that will take effect on July 1, 2026. These modifications aim to standardize charges across different account types, particularly affecting Tier-II accounts and dormant accounts. Under the new rules, Annual Maintenance Charges (AMC) for Tier-II accounts will now align with those of Tier I accounts, eliminating the previous cost differential. For investors using Tier-II accounts as flexible savings options, this means costs will now reflect those of their core retirement accounts.

Additionally, each pension scheme under a single Permanent Retirement Account Number (PRAN) will be treated as a separate account, leading to potentially higher total charges for subscribers holding multiple schemes. Dormant accounts, defined as those with no contributions for four consecutive quarters, will incur a reduced AMC of 10% of the applicable rate, ensuring that they are not completely cost-free. The changes also include protections for low-balance accounts, as no AMC will be charged if the Tier-II balance is up to ₹1,000. Investors are advised to reassess their strategies in light of these adjustments, as even minor fee changes can significantly impact long-term returns.