Senior Citizen Savings Scheme (SCSS) was launched in 2004 by the government of India in order to provide a guaranteed return to the senior citizens by means of safe investment. This scheme offers risk-free investment to the senior citizen.
HUF & NRI are not eligible to open SCSS account
Following are the documents required to open SCSS account:
One can open Sr Citizen Saving Scheme at any Post Office across India. There are also many national and private banks that facilities the scheme.
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In SCSS account, a minimum investment amount should be of INR 1,000 and a maximum could be INR 15 lacs. The scheme allows only one deposit in the account and this shall be in multiples of INR 1,000. The amount invested cannot exceed the money that has been received on retirement. Thus, an individual can invest either INR 15 lacs or the amount received as a retirement benefit (whichever is lower). Even though the deposit is limited to only one time, a person can open multiple SCSS accounts, which is not in the case of PPF (wherein a person can only open one PPF account).
The current interest rate applicable to SCSS is 8.2% p.a. This interest rate is applicable from 1st April 2023 until 30th June 2023. The interest will be paid on a quarterly Basis.
The following are the historic interest rates of the SCSS account-
|Interest Rate (% annually)
|April to June (Q1 FY 2020-21)
|Jan to March (Q4 FY 2019-20)
|Oct to Dec 2019 (Q3 FY 2019-20)
|Jul to Sep 2019 (Q2 FY 2019-20)
|Apr to Jun 2019 (Q1 FY 2019-20)
|Jan to March 2019 (Q4 FY 2018-19)
|Oct to Dec 2018 (Q3 FY 2018-19)
|Jul to Sep 2018 (Q2 FY 2018-19)
|Apr to Jun 2018 (Q1 FY 2018-19)
|Jan to March 2018 (Q4 FY 2017-18)
|Oct to Dec 2017 (Q3 FY 2017-18)
|Jul to Sep 2017 (Q2 FY 2017-18)
|Apr to Jun 2017 (Q1 FY 2017-18)
Data Source: National Savings Institute
The tenure of SCSS is of 5 years. However, there is an option to extend the scheme further for three years. In order to extend the scheme, one has to submit the dully filled Form B (after the completion of 5 years), which is regarding the extension of the scheme. Such extension accounts can also be closed after a year without paying any penalty.
The premature withdrawals are allowed, but only after one year of account opening. On the account closure, before the end of two years, 1.5 percent of the deposit shall be deducted as pre-mature withdrawal charges. And, on the closure of the account after 2 years an amount equal to 1 percent of the deposit shall be deducted as charges. No charged or penalty is levied for premature closure of the account in the event of death.
The interest earned on the deposit is fully taxable and tax is deducted at source (TDS) as per applicable income tax Rules. Although, is the income is not taxable, an individual has to provide 15H or 15G form so that no tax is deducted at source.
Apart from the post offices, the SCSS account is also offered at selected Public and Private sector banks mentioned below:
|Authorized Banks for SCSS Account
|Authorized Banks for SCSS Account
|Bank of Maharashtra
|Bank of Baroda
|Bank of India
|Central Bank of India
|Indian Overseas Bank
|Punjab National Bank
|State Bank of India
|State Bank of Mysore
|State Bank of Bikaner and Jaipur
|State Bank of Patiala
|State Bank of Travancore
|State Bank of Hyderabad
|Union Bank of India
Opening a Senior Citizen Savings Scheme (SCSS) account with a bank in India is a straightforward process. Here are the steps to open an SCSS account with a bank:
Choose the bank where you want to open your SCSS account. SCSS accounts are typically available at authorized banks and post offices. You can select a bank that is convenient for you
Request an application form for opening an SCSS account from the bank. The bank staff will provide you with the necessary forms and guide you through the application process
Carefully fill out the application form with accurate and complete information. You may need to provide personal details, contact information, nominee details, and any other required information
Submit Know Your Customer (KYC) documents, including proof of identity, proof of address, and passport-sized photographs. Banks typically require documents such as aadhaar card, PAN card, passport, voter ID, or driver's license for identity and address verification
Deposit the amount you wish to invest in the SCSS account. Ensure that the deposit amount is within the permissible limits. The minimum deposit amount is usually Rs. 1,000, while the maximum is Rs. 15 lakhs for an individual account and Rs. 30 lakhs for a joint account (if both account holders are eligible senior citizens)
Your signature and photograph may be required for record-keeping purposes
Nominate a person who will receive the proceeds of the SCSS account in case of your demise. You will need to provide the nominee's name, address, and relationship.
Once you have completed the application form, attached the required documents, and deposited the funds, submit the application to the bank. After submitting your application, the bank will provide you with an acknowledgment Receipt. Keep this receipt for your records
The bank will process your application and activate your SCSS account. You will receive an account passbook or statement with details of your account, including the interest rate and maturity date
It's important to note that the SCSS has a fixed tenure of 5 years, and you can choose to extend it for an additional 3 years if you wish. If you have any questions or need assistance during the application process, don't hesitate to ask the bank staff for guidance.
The Senior Citizen Savings Scheme is a popular choice among elderly individuals looking for regular income and Capital protection. It offers higher interest rates compared to many other savings options, along with tax benefits. However, individuals considering investing in this scheme should carefully review the terms and conditions and assess their financial needs before making any investments.
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