SCSS full form is Senior Citizen Savings Scheme. It is a government-sponsored savings instrument for individuals above the age of 60. The Government of India introduced this scheme in 2004, intending to provide senior citizens with a steady and secure source of income for their post-retirement phase.

It is one of the most lucrative savings schemes in India and offers comparatively substantial returns to its subscribers. Furthermore, it is a government-backed scheme, and hence, the risk of capital loss is negligible.

Individuals can apply for SCSS through post offices as well as public & private banks.


Senior Citizen Savings Scheme (SCSS)
SCSS full form is Senior Citizen Savings Scheme. It is a government-sponsored savings instrument for individuals above the age of 60. The Government of India introduced this scheme in 2004, intending to provide senior citizens with a steady and secure source of income for their post-retirement phase.

It is one of the most lucrative savings schemes in India and offers comparatively substantial returns to its subscribers. Furthermore, it is a government-backed scheme, and hence, the risk of capital loss is negligible.

Individuals can apply for SCSS through post offices as well as public & private banks.

Recent News about Senior Citizen Savings Scheme (SCSS)

The Finance Ministry of India has made PAN and Aadhaar Card numbers mandatory for making investments in Senior Citizen Savings Scheme (SCSS). The government issued a notification about the same on March 31, 2023.

Features of the Senior Citizen Savings Scheme
To elaborate on what is Senior Citizen Savings Scheme, here are the characteristics of SCSS discussed below –

Quarterly Revision of Interest Rates
The interest rate offered under the Sr Citizen Saving Scheme is revised every quarter, and its derivation depends on several factors, such as the prevalent rates in the market, inflation level, etc.

Due to stagnant economic conditions or no significant change in it, rates might remain the same after revision.

Fixed Income
The interest rate declared during the time of investment remains fixed throughout the maturity tenure and is not affected by alterations in a later quarter.

Minimum and Maximum Deposit
Eligible individuals require making a minimum deposit of Rs. 1,000 to open an account under the Senior Citizen Scheme. At the same time, the deposit quantum is capped at Rs. 30 Lakh or the amount received as a retirement benefit, whichever is lower.

For example, if an individual receives Rs 10 Lakh as a retirement benefit, he can invest up to that amount in the scheme. This clause applies irrespective of whether the account is held individually or jointly. However, one can only open a joint account with his/her spouse.

Also, if an individual holds multiple accounts under this scheme, the total amount deposited in all such accounts shall not exceed the maximum limit.

Maturity Tenure
The maturity period for the SCSS scheme is 5 years. It can be extended for another 3 years, effectively bringing up the period to 8 years. If an individual is willing to extend such a period by 3 years, he/she shall submit Form B after duly filling it. An extension is allowed only once. Upon extension, however, interest rates applicable at that quarter would apply.

For instance, an individual deposited Rs. 7 Lakh under SCSS in April 2012, when the interest rate offered was 9.3%. However, when she extended this scheme in April 2017, the interest rate she was eligible to earn stood at 7.4%.

Premature Withdrawals and Account Closure
An individual can withdraw prematurely from their account under Sr. Citizen Savings Scheme one year after account opening. If an individual closes their account before the completion of 2 years, 1.5% of the deposited amount will be deducted as a penalty.

If account closure takes place after the completion of 2 years, 1% of the deposited amount is levied as a penalty. In the case of extended accounts, an individual can close their account after the first year without incurring any penalty.

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