PFRDA has advised Points of Presence (PoPs) to use the emerging technology for enhanced due diligence and error free, timely processing of claims.
To streamline the processing of service requests, the Pension Fund Regulatory and Development Authority (PFRDA) will permit a video-based customer identification process (VCIP) to verify a nominee, claimant, and legal heir while processing the withdrawal claims in case of death of NPS subscribers.
As per a media report, while the video-based identification facility is optional for intermediaries, the pension regulator has advised Points of Presence (PoPs) to utilise the emerging technology for enhanced due diligence and error-free, timely claims processing. PFRDA has reportedly said that the e-NPS death claims NPS Trust may use the VCIP process while processing e-NPS death claims.
Meanwhile, earlier this month, PFRDA had notified, “in line with the technological advancements and for ensuring seamless exit claim processing, it has been decided to allow the intermediaries to use VCIP as an added due diligence mechanism for verification of the nominee/claimant/legal heir while processing the withdrawal claims in case of death of NPS subscribers.”
In its circular, the pension regulator said it has been receiving representations from intermediaries to allow the use of VCIP for faster processing of withdrawal claims and observed that VCIP would further strengthen the intermediaries’ due diligence efforts to verify that the nominees or the legal heirs are the same people as the one shown in the documents for processing withdrawal claims, as the nominee’s credentials can be determined through Aadhaar e-KYC .
The circular highlighted that “all the intermediaries are hereby informed to use Instant Bank Account Verification through penny drop to verify claimants’ bank account information as part of claim processing, which allows independent verification of bank account and name matching.”
Notably, PFRDA has been encouraging PoPs, especially online PoPs, to use emerging technologies to enhance their due diligence process for error-free, timely claims processing. Interestingly, apart from the intermediaries registered with PFRDA, those registered with other financial sector regulators are also permitted to follow the VCIP guidelines for NPS-related activities for the ease of customers.
Additionally, last year in December, PFRDA launched an NPS prosperity planner to calculate the probable retirement income for the subscribers and to help subscribers calculate their retirement income based on annuity options and contributions to the NPS. The facility is available for individuals through the three central recordkeeping agencies (CRAs)—Protean (formerly NSDL), Fintech, and CAMS. Subscribers can access the calculator after logging in to their NPS account with the respective CRAs.