Pension Fund Regulatory & Development Authority (PFRDA) Chairman Hemant Contractor has advised the Finance Ministry to allow "lifecycle funds" as an investment option for government employees who are subscribers of the National Pension System (NPS). Since interest rates in the system are decelerating, he pointed out at a presser that there is a distinct possibility that overall returns of government-NPS will be affected if avenues to better returns are not provided. The PFRDA is of the view that providing an option of investing in 'lifecycle funds' will improve equity returns, just as increasing the overall cap of equities to 50 percent from the current 15 percent will improve overall returns for government-NPS. Government-NPS subscribers have not been able to make the most of the recent bull market due to the cap on their equity exposure, he added. Currently, for government employees, the equity exposure on NPS contributions has been capped at 15 percent. There is no explicit option for them to choose lifecycle funds - both aggressive and conservative-oriented funds. Contractor also said that to apply for partial withdrawal in NPS, the minimum required years of subscription was reduced from 10 to three years. Also, the existing guidelines of the requirement of five years gap for applying for next partial withdrawal have been dispensed with. This new dispensation is effective from August 10 this year.