What is Tier 1 NPS?
NPS
Jan 19, 2025
DSP Pension Fund Managers is the newest NPS pension fund. It started running money in December 2023, so it has under three years of history and only a 1-year record to compare. Its regular Tier I E, C and G schemes hold about ₹7,500 crore, the smallest of the ten.
On that short record, its equity scheme had the weakest year of all ten funds, its corporate bond scheme sits in the upper half, and it takes the most credit risk.
At a glance
| Scheme (Tier I) | Assets | 3-year return (rank) | 5-year return (rank) | 10-year return (rank) |
|---|---|---|---|---|
| Scheme E (equity) | ₹3,467 crore | – | – | – |
| Scheme C (corporate bonds) | ₹1,587 crore | – | – | – |
| Scheme G (government bonds) | ₹2,419 crore | – | – | – |
Returns for Tier I as on 18 September 2026; assets from Value Research, October 2026. “–” means the fund has not completed that period.
Scheme E (equity)
| Period | DSP | Benchmark | Average of all funds | Rank |
|---|---|---|---|---|
| 1 year | -9.21% | -3.95% | -5.09% | 10 of 10 |
| Since inception | 7.22% | – | – | – |
DSP’s equity scheme returned -9.21% over the year to 18 September 2026, the weakest of all ten funds and 5.26 percentage points below the benchmark. Since launch, it has returned 7.22% a year.
It also holds the least equity of the ten: 89.87%, with 4.80% in debt, 3.22% in REITs and 2.11% in cash. Holding less equity would normally soften a falling market, so the weak year came from what the scheme held rather than how much of it was in shares.
Scheme C (corporate bonds)
| Period | DSP | Benchmark | Average of all funds | Rank |
|---|---|---|---|---|
| 1 year | 5.42% | 4.90% | 5.26% | 4 of 10 |
| Since inception | 7.51% | – | – | – |
The corporate bond scheme ranked fourth of ten over the past year, beating the benchmark. Since launch, it has returned 7.51% a year.
DSP takes the most credit risk of the ten: 21.49% of the portfolio is AA-rated, against 71.68% AAA. That is the highest AA share in NPS. It raises the return while no bond defaults, which is why a longer record will tell more.
Scheme G (government bonds)
| Period | DSP | Benchmark | Average of all funds | Rank |
|---|---|---|---|---|
| 1 year | 2.68% | 3.43% | 2.93% | 8 of 10 (tied) |
| Since inception | 6.40% | – | – | – |
The government bond scheme tied for eighth over the past year, below the benchmark. The portfolio is 90.18% sovereign and the most concentrated of the ten: its largest holding, a 7.71% government bond maturing in 2066, is 20.44% of the fund.
MSF schemes
| Scheme (as listed by NPS Trust) | Equity range | Assets (₹ crore) |
|---|---|---|
| Long Term Equity – I | 0%-100% | 18.95 |
NPS Trust, as on 30 September 2026.
Long Term Equity can hold anything from 0% to 100% in equity, with up to 20% in bonds and alternative assets. It had ₹19 crore. See the MSF comparison.
Fees
From 1 April 2026, the investment management fee on regular non-government NPS schemes is slab-based: 0.12% a year on the first ₹25,000 crore of assets, then 0.08%, 0.06% and 0.04% on higher slabs. MSF schemes can charge up to 0.30%.
Verdict
- Track record: under three years, too short to judge a pension fund on.
- Scheme E: the weakest 1-year return of the ten, with the lowest equity share.
- Scheme C: upper half over 1 year, with the most AA-rated bonds.
- Scheme G: below the benchmark, with the most concentrated portfolio.
- For a new account: funds with 10-year records give you more to go on. If you’re already with DSP, review it once it has a 3-year record. You can switch pension funds once a financial year.
Compare it with the rest in the Scheme E, Scheme C and Scheme G comparisons.
Sources: returns for Tier I as on 18 September 2026, NPS Trust data as published by HDFC Securities. Net assets and portfolios: Value Research, October 2026. MSF schemes: NPS Trust. Fees: PFRDA. Past returns do not guarantee future returns.
