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Post Office Schemes for Sr. Citizens – Features | Interest Rates

Post Office Schemes for Senior Citizens

Which is the Best Post Office Scheme for Senior Citizens?

Post Office Schemes for Senior Citizens, those aged 60 years and above, can invest in the Senior Citizens Savings Scheme (SCSS) to earn regular interest income.
Interest earned on deposits under this plan is payable quarterly.
The deposit matures after Five years from the date of account opening but can be extended once by an extra 3 years.
As of now, the maximum that can be invested in this plan by any individual has been capped at Rs 15 lakh.
SCSS is available through India Post Offices/Banks.
The terms and conditions applicable to the schemes are the same, regardless of the bank/ post office, you invest through.

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Features of Post Office Scheme for Sr. Citizens

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EligibilityAn individual above 60 years of age.
Retired Civilian Employees above 55 years of age and below 60 years of age,
subject to the condition that investment is made within 1 month of receipt of retirement benefits.
Retired Defense Employees above 50 years of age and below 60 years of age,
subject to the condition that investment is made within 1 month of receipt of retirement benefits.
The account can be opened in an individual capacity or jointly with a spouse only.
The whole amount of deposit in a joint account shall be attributable to the first account holder only.
DepositThe minimum deposit shall be Rs. 1000 and in multiple of 1000, subject to maximum limit up to Rs. 15 lakh in all SCSS accounts opened by an individual.
In case any excess deposit is made in the SCSS account, the excess amount will be refunded immediately to the depositor,
and only PO Savings Account Interest rate will apply from the date of excess deposit to the date of refund.
Investment under this scheme qualifies for the benefit of section 80C of the Income Tax Act, 1961.
Premature ClosureThe account can be prematurely closed any time after the date of opening.
If the account is closed before 1 year, no interest will be payable, and if any interest paid in the account shall be recovered from principle.
If the account closed after 1 year but before 2 years from the date of opening,
an amount equal to 1.5 % will be deducted from the principal amount.
If the account closed after 2 years but before 5 years from the date of opening, an amount equal to 1% will be deducted from the principal amount.
Post Office Schemes for Sr. Citizens

Account Closure on Maturity

  • Account may be closed after 5 year from the date of opening by submitting prescribed application
    form with passbook at concerned Post Office.
  • In case of death of account holder, from the date of death, account shall earn interest
    at the rate of PO Savings Account.
  • In case spouse is a joint holder or a sole nominee, account can be continued till maturity
    if spouse is eligible to open SCSS account and not have another SCSS Account.

Also Read IPPB Net-Banking Registration | Features | Virtual Debit Card

Extension of Account

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  • Account holder may extend the account for further period for 3 years from the date of maturity by submitting prescribed form with passbook at concerned post office.
  • Account can be extended within 1 year of maturity.
  • Extended account shall earn interest at the rate applicable on the date of maturity.

Also Read Savings Account Registration | Online | Interest Rate | Features

Interest Rates

  • 7.4 ​% per annum.
  • Interest shall be payable on a quarterly basis and applicable from the date of deposit to 31st March/30th June/30th September/31st December.
  • If the interest payable every quarter is not claimed by an account holder, such interest shall not earn additional interest.
  • Interest can be drawn through auto credit into a savings account standing at the same post office, or ECS.
  • In the case of the SCSS account at CBS Post offices, monthly interest can be credited into a savings account standing at any CBS Post Offices.
  • Interest is taxable if total interest in all SCSS accounts exceeds Rs.50,000/- in a financial year and TDS at the prescribed rate shall be deducted from the total interest paid. No TDS will be deducted if form 15 G/15H is submitted and accrued interest is not above the prescribed limit.

Source – Post-office

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