Key Personal Finance Changes To Take Effect in February 2024
Key Personal Finance Changes To Take Effect in February 2024

From IMPS to NPS, Here are Key Personal Finance Changes To Take Effect in February 2024

From IMPS getting more user-friendly to new partial withdrawal rules in NPS, these are major news that might have an impact on the finances of those related to these developments.

As February 2024 unfolds, it is important to stay updated on significant financial changes that could impact your earnings.

Here are the main financial changes to keep an eye on this month including alterations in the National Pension System (NPS), Immediate Payment Service (IMPS), Sovereign Gold Bonds (SGBs), and FASTags.

NPS' New Partial Withdrawal Rules

The Pension Fund Regulatory and Development Authority (PFRDA) has implemented new rules allowing for partial withdrawals from the National Pension System (NPS).

Effective February 1, 2024, subscribers can withdraw a maximum of 25 per cent of their own contribution to pension fund, for specific purposes. These include higher education and marriage of children.

"Purchase or construction of a residential house or flat in the subscriber's own name or joint name with their legally wedded spouse. However, if the subscriber already owns a residential house or flat (other than ancestral property), no withdrawal shall be permitted," PFRDA said.

Also, treatment of specified illnesses is permitted grounds for withdrawal. However, to be eligible, subscribers must have been an NPS member for at least three years, and should not have made three partial withdrawals earlier.

IMPS Made Easy From This Month

Starting February 1, 2024, the Immediate Payment Service (IMPS) for seamless fund transfers of up to Rs 5 lakh can be made between bank accounts without beneficiary details. IMPS is one of the most commonly used ways of real-time fund transfers 24*7 through multiple channels such as internet and mobile banking, ATMs, SMS, and IVRS.

Previously, IMPS transfers needed the recipient's mobile number and Mobile Money Identifier (MMID). In case you don’t have the receiver’s MMID, then you must have his/her bank account number, IFSC and Aadhaar number. From now on these beneficiary details are not needed except the recipient's mobile number and his bank name.

RBI To Issue Final Tranche of SGB 2023-24 Series

The Reserve Bank of India (RBI) will issue the last tranche of Sovereign Gold Bonds (SGBs) in the 2023-24 series from February 12 to February 16, 2024. Successful applicants will receive their SGBs on February 21, 2024.

While the issue price remains undisclosed, investors opting for online subscriptions and digital payments receive a Rs 50 discount per gram. The last tranche of SGB in this series was issued in December 2023, at Rs 6,199 per gram. The minimum investment allowed is one gram, with a maximum subscription limit of 4 kg for individuals.

Deactivated FASTags To Attract Penalties

The National Highway Authority of India (NHAI) had mandated that FASTags lacking complete Know Your Customer (KYC) details will face deactivation or blacklisting by issuing banks after January 31.

So if you failed to complete KYC by February 1, on your latest issued card, it might have led to your card deactivation. If you use that card at a toll plaza, the toll charge when you cross a toll plaza is usually double the regular amount and penalties may be incurred on malfunctioning tags.

If your card is deactivated, FASTags are available for purchase at most toll plazas, and after buying them, users can link them to their bank accounts, and recharge with amounts ranging from Rs 100 to Rs 1 lakh for a full-KYC account.

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