NPS investment choices extended to Central Autonomous Body employees
Synopsis
Central Autonomous Body employees can now invest in equity-heavy NPS life cycle funds — a benefit previously reserved for Central government staff. The move, formalised on 1 July 2026, lets CAB subscribers chase higher retirement returns with up to 75% equity exposure, closing a policy gap that opened when these funds were first introduced in November 2025.
Key Takeaways
The Finance Ministry extended NPS investment choices to Central Autonomous Body (CAB) employees via a memorandum dated 1 July 2026 .
The two new options are the Aggressive Life Cycle Fund (LC-75-High) — equity up to 75% — and the Balanced Life Cycle Fund (BLC) — equity capped at 50% .
These funds were previously available only to Central government employees under NPS since 13 November 2025 .
Equity allocation under the BLC begins reducing from the age of 45 years .
The choices will be activated through the Central Recordkeeping Agency (CRA) system; ministries have been directed to inform CABs.
The Union government has expanded the scope of the National Pension System (NPS) by extending two additional investment options — the Aggressive Life Cycle Fund (LC-75) and the Balanced Life Cycle Fund (BLC) — to employees of Central Autonomous Bodies (CABs), according to a Finance Ministry statement issued on Tuesday, 7 July 2026. Until now, these choices were exclusively available to Central government employees enrolled under NPS.
What Changed and When
The extension was formalised through an office memorandum dated 1 July 2026, issued by the Department of Expenditure under the Ministry of Finance. The memorandum extends the applicability of a Department of Financial Services notification originally dated 13 November 2025, which had introduced these two funds for Central government employees. CAB employees are now brought under the same framework.
Understanding the Two New Fund Options
The Aggressive Life Cycle Fund (LC-75), now officially designated LC-75-High, allows equity exposure of up to 75 per cent, making it suited for subscribers with a higher risk appetite seeking long-term capital growth.
The Balanced Life Cycle Fund (BLC), now renamed the Aggressive Life Cycle Fund, caps equity exposure at 50 per cent and introduces a gradual reduction in equity allocation starting from the age of 45 years. This option targets subscribers seeking a measured balance between growth and stability as they approach retirement.
What the Government Said
'The extension of these investment choices aims to provide greater flexibility for NPS subscribers in Central Autonomous Bodies, enabling them to align their pension investments with their individual risk appetite, financial goals, and retirement planning requirements,' the Finance Ministry statement said. It added that the move 'further strengthens subscriber choice and enhances the attractiveness of the National Pension System.'
The ministry has directed administrative ministries and departments to notify CABs under their control and ensure the information reaches eligible NPS subscribers so they may avail of the facility. The investment choices will be made available through the Central Recordkeeping Agency (CRA) system.
Impact on Employees
This is a meaningful shift for CAB employees, who previously had a narrower set of NPS investment options compared to their counterparts in the Central government. The addition of equity-heavy life cycle funds gives these subscribers a tool to potentially build a larger retirement corpus, particularly for those with longer investment horizons. Notably, the move aligns pension flexibility across two large segments of the government workforce, narrowing a policy gap that had existed since the original November 2025 notification.
What Happens Next
Administrative ministries are expected to cascade the information to CABs promptly. Once the options go live on the CRA system, eligible employees will be able to switch into or select these funds as part of their NPS portfolio. The government has not specified a deadline for when the choices will be operationally active on the platform.
Frequently Asked Questions
What are the new NPS investment choices extended to Central Autonomous Body employees?
The two new options are the Aggressive Life Cycle Fund (LC-75-High), which allows equity exposure up to 75%, and the Balanced Life Cycle Fund (BLC), which caps equity at 50% with gradual reduction from age 45. These were extended to CAB employees via a Finance Ministry memorandum dated 1 July 2026.
Who is eligible for these new NPS fund options?
Employees of Central Autonomous Bodies (CABs) covered under the National Pension System (NPS) are now eligible. Previously, these options were available only to Central government employees enrolled under NPS.
When did the Finance Ministry issue this extension?
The office memorandum extending these choices was issued on 1 July 2026 by the Department of Expenditure. It extends a Department of Financial Services notification originally dated 13 November 2025.
How do the LC-75 and BLC funds differ?
The LC-75-High fund carries up to 75% equity exposure and is designed for subscribers seeking higher long-term growth. The BLC fund caps equity at 50% and begins reducing equity allocation from age 45, offering a more conservative balance between growth and capital preservation.
How can CAB employees access these new NPS options?
The investment choices will be made available through the Central Recordkeeping Agency (CRA) system. Administrative ministries have been directed to inform CABs under their control, who will in turn notify eligible NPS subscribers.
