The National Pension System (NPS) was introduced by the Central Government of India on January 1, 2004, for all Central Government employees and employees of Central Autonomous Bodies (CABs) who joined on or after that date, except for the Armed Forces. The Pension Fund Regulatory and Development Authority (PFRDA) regulates the NPS.
Under NPS scheme, employee salary deducted by 10% and that amount is given to his/her account in NPS. 10% or 14% amount of employee salary is also given by Employer to employee NPS account. Now NPS amount grows with time and growth is depends on stock market condition and scheme preference selected by employee at NPS. At 60 year of age, person can withdraw the 60% of lump sum amount (if they wish, they can keep it for annuity) and rest in annuity form. Employee is having full control of their amount in NPS for withdrawal (of 60%) or investment and selecting annuity plan . Gov has no role with fund after retirement.
In UPS, 10% salary of employee will be deducted and given to UPS fund. Gov will also contribute 18.5% (may change) of employee salary to UPS fund. At time of retirement (after 25 year of service) Employee will get fixed minimum pension of 50% of average basic pay of last year of service ( 60% of lump sum amount will not be given) . There is other new scheme is implemented which will give some lump sump amount at retirement: 1/10th of monthly emoluments (pay + DA) as on the date of superannuation for every completed six months. i.e. if person is retiring after 30 year of job they will get 6 month salary ( pay + DA) as the new emolument. Gratuity will be same given as lump sum (similar for both scheme).
NPS is good for those person who has very large growth of money in their NPS account as stock market grew well and they know very well how to use or invest large amount of money received by NPS at the time of retirement. Or they are requiring large amount of money at the time of retirement like they want to buy house or land.
UPS is good for people who are not expert in investing large amount or they are in fear that some other person will take/cheat their large money. They are is good health and expect longer life after retirement and not required large amount at once. With monthly pension ( which also grow depending on inflation), they can manage their day to day requirement comfortably.
Above information is for rough information only and may contain error . Users are reqested to do further reserch before making any decision.