To make the PPF investment more investor friendly, the govt has been reported to mull over a proposal to allow pre-mature closure of the account which has the highest lock-in period otherwise. In the current regime, the account cannot be closed prematurely unless it completes 5 years.
Also there has been a proposal worked upon to allow opening small saving scheme accounts in the name of the minor.
This shall be done to make the legislations simpler in accordance with the amendments proposed in the Finance Bill 2018.
The finance ministry in his statement on Tuesday said that "No existing benefits to depositors are proposed to be taken away through this process" and there has been a proposal to merge Government Savings Certificates Act, 1959 and Public Provident Fund Act, 1968 with the Government Savings Banks Act, 1873.
Also the government is aiming to provide some new benefits to the investors apart from the current benefits.
It further added, "The main objective in proposing a common Act is to make implementation easier for the depositors as they need not go through different rules and Acts for understanding the provision of various SSS, and also to introduce certain flexibilities for the investors".
The provision will be employed to meet any kind of exigency such as financial needs to meet higher education or some medical emergencies.
Apart from the higher interest rates, these SSS enjoy tax benefits and includes some of the likes of Post Office Savings Account, National Savings Monthly Income (Account), National Savings Recurring Deposit, PPF and Sukanya Samriddhi Account.
With Inputs From PTI