NPS stands for the National Pension System, which is a voluntary and long-term retirement savings scheme initiated by the Government of India. It is regulated by the Pension Fund Regulatory and Development Authority (PFRDA). The NPS aims to provide pension income to Indian citizens during their retirement years.

Key features of the National Pension System (NPS):

1. Voluntary Participation: NPS is open to all Indian citizens, including salaried employees, self-employed individuals, and non-resident Indians (NRIs). It is a voluntary scheme, and individuals can join it on their own.
2. Two Tiers: NPS has two tiers - Tier I and Tier II. Tier I is the mandatory and core pension account, which has certain restrictions on withdrawal. Tier II is an optional account that offers higher flexibility in withdrawals but is not eligible for tax benefits.
3. Contribution and Investment: Under Tier I, participants are required to contribute regularly throughout their working years. The contributions are invested in a mix of equity, corporate bonds, government securities, and other financial instruments through Pension Fund Managers (PFMs).
4. Individual Pension Account: Each subscriber has an individual Permanent Retirement Account Number (PRAN), which acts as a unique identifier for their pension account. The PRAN remains constant throughout the subscriber's life, even if they change jobs or locations.
5. Tax Benefits: NPS offers tax benefits under Section 80CCD(1), 80CCD(2), and 80CCD(1B) of the Income Tax Act, 1961. Contributions up to a certain limit are eligible for tax deductions, and the interest earned on investments is tax-exempt up to a specified limit.