National Pension System (NPS) Tier II Scheme Performance Report

Overview

The NPS Tier II Scheme allows subscribers to invest voluntarily in market-linked instruments with complete flexibility and no lock-in period. Returns differ across schemes and pension fund managers, making it essential for investors to carefully select a fund manager and align their asset allocation with their risk appetite and long-term financial goals.

Returns Analysis

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As of February 23, 2026, pension fund managers under the NPS Tier II scheme have delivered mixed returns across asset classes and tenures. The top performers include:

• Tata Pension Fund (Equities) with a 3-year return of 18.79%
• HDFC Pension Fund (Corporate Bonds) with a 10-year return of 8.56%
• LIC (Government Bonds) with a return of 9.11%

Tier II Scheme Performance

Scheme E - Equities (Tier II)

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• Risk level: High
• Returns range from 8.48% to 18.79% across tenures

Scheme C - Corporate Bonds (Tier II)

• Risk level: Moderate to Low
• Returns range from 6.96% to 8.56% since inception

Scheme G - Government Bonds (Tier I)

• Risk level: Low
• Returns range from 3.49% to 9.11% as of February 23, 2026

Comparison with Tier I Scheme

The NPS Tier I scheme has outperformed Tier II returns in the equity category over 1, 3, 5, and 7 years, except for the 10-year tenure. Investors should exercise caution and carefully plan when selecting an NPS fund manager to ensure their asset allocation aligns with their risk appetite and long-term financial goals.