There are multiple online modes to pay the contribution to NPS, and the modes vary according to the platform chosen by the subscriber. Here we address the question of can one pay NPS through a credit card, how to make the online payment through a credit card, the charges levied, downloading receipt, benefits and disadvantages.
Eligibility of Credit Card as a Payment Mode for NPS
Can I pay NPS through a credit card? Yes, NPS can be paid through a credit card using the eNPS portal or the PoP portal depending on the options available on the platform and the contribution mode (mostly Tier I contributions). Credit card payment for NPS has a payment gateway charge and should be reviewed on the screen while making the payment.
Steps to Pay NPS Contributions Through Credit Card
- Log on to the NPS Contribution Portal
Go to the website of the eNPS portal or the online contribution portal of the Point of Presence (PoP).
- Enter the Details of the Subscriber’s NPS Account
Enter the Permanent Retirement Account Number (PRAN) with 12 digits and the One-Time Password (OTP) sent to the registered mobile number/email ID.
- Make the Contribution
Select the Tier of the subscriber’s NPS account (mostly Tier I) and the contribution amount with the minimum contribution limit.
- Choose Credit Card and Make the Payment
Choose the option of Credit Card as a contribution mode available along with Debit Card and Net Banking.
- Authentication of Credit Card Payment for NPS
Provide the credit card details and authenticate the payment according to the bank’s security measures.
- Confirmation of NPS Payment Through Credit Card
Check the confirmation page to view the contribution details.
Charges Applicable for NPS Payment Through Credit Card
Is there a charge for paying NPS through a credit card? Yes, there is a bank levy or payment gateway charge for making credit card payment for NPS contributions around 0.75%-0.9% plus 18% GST which is higher than the charges levied in case of net banking which is mostly a flat rate per transaction. The rates mentioned might differ depending on the platform chosen to make the payment and thus it is always better to check the exact charges before making the payment rather than assuming a particular rate.
Receipt Details of NPS Contribution Made Through Credit Card
How to download the receipt after making NPS contribution through credit card? After making the payment through a credit card as discussed above, the receipt can be downloaded by:
Checking that the transaction is successful on the confirmation page
Logging into the subscriber’s NPS account and finding the contribution/payment history option
Viewing/download the receipt of contribution to the NPS account and cross-verifying the details like PRAN, contribution amount, and transaction number.
Benefits of Paying NPS Through Credit Card
Easy and Instant Digital Transaction
NPS contribution through credit card makes the online transactions through a card seamless without requiring a separate initiative for fund transfer to the NPS account.
Easy Mode of Payment
In case credit card is one of the payment modes available for NPS subscription, it provides a convenient alternative when one does not want to make the payment through net banking or debit card at a given point in time.
Transaction History Records
Both, the credit card transaction history and the NPS transaction history records serve as a proof of payment for the contribution made to the NPS.
Disadvantages/Possible Drawbacks for Paying NPS through Credit Card
Is it advisable to make NPS payment through a credit card? One should be aware of the following:
Higher Payment Gateway Charges Applicable
Credit card as a mode of payment for NPS subscription attracts higher payment gateway charges compared to net banking.
Payment Gateway Charges as a Burden for Small Contributions
In case of small contributions, the relative share of payment gateway charges would be higher thus, potentially defeating the purpose of long-term savings through NPS.
Charges Applicable for Late Repayment of Credit Card Bill
If one is unable to make the full payment for the credit card bill on time, additional interest charges would be levied by the bank which would not be desirable for NPS subscription.
Spending Ability Reduced Due to Credit Card Payment for NPS
Using funds from a credit card for NPS subscription is akin to spending money since the subscriber would have to pay back the borrowed money and thus, it reduces the ability to spend on other things especially if the subscriber is spending beyond his/her means.
Comparison with Other Modes of NPS Payment
Credit Card
Debit card allows direct payment from the bank account and thus, the funds that would have been used for NPS contribution would not be available for other purposes until the credit card bill is paid.
Net Banking
Net banking transactions for NPS subscriptions mostly attract lesser charges as compared to the credit card payments and works on the same principle as the debit card.
UPI or Other Digital Modes
Wherever UPI or other digital modes are available for NPS subscriptions, those are convenient and quick with minimal or no charges applicable as compared to credit card and similar to net banking/debit card. These digital modes mostly work on the same principle as the debit card but use funds that one has already got in one’s bank account.
Things to consider before making NPS subscription through a credit card
What to check before making NPS subscription through a credit card? One should check:
• Whether the credit card is an accepted mode of payment for NPS subscription on the chosen platform
• Whether there are any additional charges like processing fees etc. before making the payment
• Whether the subscriber has entered the correct details like the PRAN and the contribution amount.
• Whether there are sufficient funds or the bill can be paid in full to avoid additional charges if the payment is not made on time.
• Whether the transaction is success and the NPS account shows the updated contribution.
Frequently Asked Questions (FAQs) Related to NPS Subscription through Credit Card
1. Can I pay NPS through a credit card?
Yes, NPS payment can be made through a credit card using the eNPS portal or the PoP portal as discussed depending on the contribution type and other factors.
2. Are there any additional charges for making NPS subscription through credit card?
Yes, as discussed there are additional charges for making NPS subscription through a credit card which are mostly in the form of processing/payment gateway charges.
3. How to check whether my NPS subscription through a credit card is successful?
After making the NPS subscription through a credit card, the subscriber should check the confirmation page and the transaction history within the NPS subscription portal to check whether the subscription/payment has been made successfully.
4. Can I download the receipt after making NPS subscription through a credit card?
Yes, the subscriber can download the receipt by logging into his/her NPS portal and finding the contribution/payment history option where he/she can view/download the receipt with the relevant details including the PRAN, contribution amount, and transaction number.
5. Is NPS subscription through a credit card a better option compared to net banking?
NPS subscription through a credit card is not a better option compared to net banking since the former attracts higher charges and works on the principle of borrowing money for a short period of time.
Disclaimer
Past performance may or may not be sustained in future and should not be used as a basis for comparison with other investments. Returns under NPS are subject to market risk and are prone to fluctuation depending on the state of the Financial market.
Investors are advised to consult their own legal, tax and financial advisors to determine possible tax, legal and other financial implication or consequence of subscribing to the schemes of DSP Pension Fund Managers Private Limited. Tax laws are subject to change.
