Senior Citizen Savings Scheme Offers 7.4% Interest per Annum; Know Eligibility, Other Benefits

In India, senior citizens often depend on bank fixed deposits (FD) or recurring deposits (RD) for a regular income after their retirement. Most citizens above 60 in the country do not have a risk appetite and avoid stock markets or mutual funds as investment options. They often incline towards risk-free savings options that give good returns. Because of this, bank and post office savings schemes are still especially popular among them, apart from other people.  To ensure this, central government come up with a scheme specifically meant for the older population who want to secure their future.

The  Senior Citizen Savings Scheme, or SCSS, is a special savings scheme specifically designed for the older population. It is meant for Indians above the age of 60, which means that the subscriber must be 60-years-old or above on the date of opening this scheme. Through this, subscribers can get a decent amount of returns and a guaranteed income from the post office or bank.

Features of Senior Citizens Savings Scheme

-An individual can open an SCSS account with a minimum deposit of Rs 1,000, while the maximum can be raised to Rs 15 lakh. The amount deposited in the account should be in multiples of Rs 1,000.

-The interest rate under this scheme is 7.4 per cent, which is the one of the highest. Interest is on quarterly basis and applicable from the date of deposit to March 31, June 30, September 30 and December 31.

-In case any excess deposit is made in SCSS account, excess amount will be refunded immediately to the depositor.

-The maturity period under this scheme is five years, but can be extended beyond that by three years.

-Investment under this scheme qualifies for the benefit of section 80C of Income Tax Act, 1961. However, interest is taxable if total interest in all SCSS accounts exceeds Rs 50,000 in a financial year.

-If an SCSS account is closed before one year, no interest will be payable and if any interest paid in account shall be recovered from principle, as per the rules.

-In case of death of account holder, from the date of death, the SCSS account will earn interest at the rate of general savings account.

Senior Citizens Savings Scheme Eligibility

Here is who can open a Senior Citizens Savings Scheme account:

-An individual above 60 years of age, who is an Indian citizen.

-Retired Civilian Employees above 55 years of age and below 60 years of age, subject to condition that investment to be made within one month of receipt of retirement benefits.

-Retired Defense Employees above 50 years of age and below 60 years of age can open SCSS account, subject to condition that investment to be made within one month of receipt of retirement benefits.

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