The Pension Fund Regulatory and Development Authority issued a circular dated 7 April 2026 introducing a modified Proof of Concept (PoC 2) for the NPS Swasthya Pension Scheme under the Regulatory Sandbox Framework. Building on earlier implementation, PoC 2 incorporates changes based on stakeholder feedback to enhance flexibility and test the scheme under varied conditions. Key provisions include mandatory health insurance governed by insurer terms and Insurance Regulatory and Development Authority of India regulations, with premiums deducted as partial withdrawals from subscriber accounts. A minimum contribution of ₹25,000 is required for eligibility. In cases of high inpatient medical expenses, subscribers may opt for full premature exit, with funds directly paid to healthcare administrators and any surplus credited back. Pension funds may launch PoC 2 schemes with prior approval, limited duration, and restricted enrolment, while earlier PoC conditions remain unchanged.
Pension Fund Regulatory and Development Authority
Circular No. PFRDA/2026/22/SUP-CRA/03 | Dated: 7th Apr 2026
To
All Stakeholders under NPS
Subject: NPS Swasthya Pension Scheme- Proof of Concept (PoC 2) under the Regulatory Sandbox Framework
Reference is invited to Circular No. PFRDA/2026/07/SUP-CRA/02 dated January 27, 2026, issued by the Authority, introducing the “NPS Swasthya Pension Scheme” as a Proof of Concept (PoC) under the Regulatory Sandbox Framework.
2. As part of PoC, “ICICI PF NPS Swasthya Equity Plus” scheme has been launched under the aforesaid framework and is currently in the PoC phase.
3. Based on the experience and feedback from the ongoing PoC and subsequent consultations with stakeholders, it has been decided to permit introduction of a modified Proof of Concept (PoC 2) with certain changes in operational and product features, with a view to enable enhanced flexibility for subscribers and to test the scheme under varied scenarios.
4. For the purpose of PoC 2, following revised provisions shall be applicable:
a. Health Insurance benefit offered under NPS Swasthya PoC 2 shall be mandatory and be governed by the terms and conditions of the respective insurance company and applicable IRDAI regulations. Complete and transparent disclosures of policy terms, including coverage, exclusions, claim process and grievance redressal mechanism, shall be provided to subscribers. The premium for such insurance top up shall be deducted as a partial withdrawal from the subscriber’s NPS Swasthya Scheme account.
b. The minimum initial contribution for onboarding shall be Rs. 25,000 (Rupees Twenty Five Thousand only). A subscriber shall become eligible to avail benefits under NPS Swasthya Pension Scheme upon such contribution.
c. In case of inpatient medical treatment where medical expenses in a single instance exceed the subscriber’s eligible limit for partial withdrawal, the subscriber shall be permitted to undertake a premature exit of 100% (one hundred percent) lump sum, irrespective of corpus size, solely for meeting such medical expenses. The proceeds arising from such premature exit shall be remitted directly to the concerned Health Benefit Administrator (HBA)/Third Party Administrator (TPA)/Health Tech Company (HTC) as the case may be, based on the valid claim and corresponding invoice. Any excess amount, after settlement of the medical expenses, shall be transferred to the subscriber’s Common Scheme Account.
All other provisions of the circular dated 27th January 2026 shall remain unchanged for PoC2.
5. Accordingly, Pension Funds may launch the NPS Swasthya Pension Scheme (PoC–2), subject to prior approval of the Authority, in collaboration with one Central Recordkeeping Agency (CRA) and one Health Benefit Administrator/Third Party Administrator/Health Tech Company, for a limited duration and with restricted subscriber enrolment, under the Regulatory Sandbox approach.
6. The aforementioned changes shall come into effect from the date of issuance of this circular in respect of schemes to be launched under PoC 2. The conditions for schemes launched and presently operational under earlier PoC continue without any change.
7. The circular is issued in exercise of the powers conferred upon PFRDA under the provisions of the PFRDA Act, 2013.
Yours sincerely,
Gurminder Kaur
(General Manager)
