NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Retirement Products
Rohit, aged 40, holds an NPS Tier I account. Which statement about the NPS Tier II account is correct?
NPS Tier II is a voluntary, withdrawable savings account that can be opened only by someone who already holds an active Tier I account. It has no lock-in until retirement age and is not compulsory, which distinguishes it from Tier I.
- AIt is a withdrawable savings facility available only to those holding an active Tier I accountCorrect
- BIt carries a lock-in until age 60
- CIt is mandatory for every Tier I subscriber
- DIt offers only government bond investment
Explanation
Tier II is a voluntary add-on facility with no lock-in, allowing withdrawals as needed. It can be opened only if the person has a Tier I account. Hence the lock-in and mandatory claims are wrong.
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