PFRDA launches NPS Swasthya pension scheme

Bengaluru: About 10% of the Indian Population falls in the category of senior citizens, and this demographic is expected to climb to over 20% by 2045-50. But several elderly remain outside the medical insurance net, making them extremely vulnerable to expenses beyond their reach, said Pension Fund Regulatory and Development Authority (PFRDA) Chairperson Sivasubramanian Ramann.

Speaking at the launch of NPS Swasthya, an initiative intended to provide healthcare funding along with retirement planning, here on Wednesday in Bengaluru, Ramann mentioned that two regulatory systems have come together to create something for the customers’ benefit.

The PFRDA launched the second proof of concept (under the regulatory sandbox) of NPS Swasthya, which is a multi-partner initiative structured to provide comprehensive financial and health security. The PFRDA serves as the regulatory authority, and Medi Assist Healthcare Services acts as the core technology partner, providing digital infrastructure.

The initiative addresses a growing gap in the country's retirement landscape, where healthcare costs are projected to rise by 11.5%–14% in 2026, significantly outpacing inflation and putting long-term financial security under pressure for millions.

This comes at a time when the pension ecosystem is rapidly scaling, with National Pension System (NPS) and Atal Pension Yojana (APY) having a cumulative subscriber base of 9.64 crore and combined assets under management pegged at Rs 16,55,655 crore as of 29 March 2026.

NPS funds have traditionally remained locked until the subscriber reaches retirement age. NPS Swasthya is designed to provide subscribers access to a Net Eligible Balance up to 25% of their contributions.

Ramann said the entire premise of NPS Swasthya Pension Scheme rests on the feasibility of integrating health-related benefit mechanisms with the existing NPS architecture and to assess the associated operational, technological and regulatory aspects.

"While the first proof of concept launched in January 2026 was for outpatient services, this second proof of concept is about inpatient and hospitalisation bills. When put together, we can actually appreciate the consolidated service from the Swasthya Account. NPS Swasthya Pension Scheme not only grows the subscriber’s corpus at a rate that is comparable to other popular instruments available in the market, but also provides financial support for out-patient and in-patient medical expenses in case of medical emergencies," he added.

NPS Swasthya is being launched under the Multiple Scheme Framework (MSF) of the National Pension System, which enables subscribers to allocate their investments across multiple schemes offered by different pension fund managers. Unused contributions continue to accumulate market-linked returns while remaining accessible for medical emergencies.

Sumit Shukla, MD & CEO, Axis Pension Fund, said, NPS Swasthya offers a very different health and hospital proposition. A hospitalisation cover of up to Rs 30 lakh at a cost of under Rs 10 per day, making healthcare preparedness more accessible within the NPS framework. The NPS Swasthya Scheme is available to Indian citizens aged 18–85.