"We have decided to launch the savings scheme from December 1 this year. Under this scheme, the customers would have be able to withdraw their entire savings," D Swarup, chairman, Pension Fund Regulatory and Development Authority told PTI.
He added that returns on this scheme, known as tier II account," are expected to be higher due to our market-linked investment patterns".
The essential feature of this saving account would be liquidity. Customers needing money in emergency situations would be able to withdraw their entire deposited sum.
However, the customers, who want to open the Tier II account, must also have Tier 1 account and both accounts should run separately.
"Those who want to open the Tier II account should essentially have Tier I account as the basis purpose of PFRDA is to manage the pension fund," a PFRDA official said. Tier 1 account was operational from May 1, under the New Pension System.
Under it, a customer can only withdraw 20 per cent of the money as a lump sum before he or she attains 60 years of age. On attaining 60 years, the customers can withdraw 60 per cent as lump sum.