Pension scheme to provide loan, other financial facilities

Similar to conventional financial schemes, depositors will have the privilege of availing loans from the universal pension scheme to address their urgent needs. The maximum loan amount will be 50 per cent of the client's total deposit.

However, there must be justified reasons for loan applications, such as meeting the treatment costs of the client or family members, house construction or renovation, and education expenses for children.

A loan must be repaid in a maximum of 24 installments and the entire amount will be redeposited into the client's account. Additionally, the authorities will fix the additional charges for a loan.

Kabirul Ezdani Khan, chairman of the National Pension Authority, revealed these details while discussing various benefits of the pension scheme during a meeting at the Metropolitan Chambers of Commerce and Industry (MCCI) on Tuesday.

A client will be able to take out loans multiple times, provided they have repaid the previous one.

Furthermore, the depositors will have have the opportunity of shift from one scheme to another, contingent on valid reasons, and the monthly payments will be adjusted accordingly. They can also revise the amount of monthly payment within the same scheme, if necessary.

In the case of a scheme change, the profit and deposit under the new scheme will be calculated separately and later added to the previous one. The amount of monthly pension will be revised upon maturity of the scheme.

A client will be the sole owner of their pension scheme and will not be permitted to transfer ownership. However, there will be no hindrance to transferring the authority to a nominee or any other heir in the absence of a nominee, should the depositor passes away at any stage of the scheme or pension.

According to experts, there are some similarities between the pension scheme and a bank deposit. However, the main difference is that a bank deposit is considered a general asset, while the pension scheme is a type of security in the late years of life.