The Senior Citizens Saving Schemes run by the post office and banks is one of the most popular savings schemes for senior citizens. It offers safety as well as high returns for senior citizens.
Can we open a Senior Citizens Savings Scheme Online?
Unfortunately, there is no way right now that the Senior Citizens Savings Scheme (SCSS) an be opened Online. In fact, we are in an era where everything has gone online, but, certain government backed schemes like the Senior Citizens Savings Scheme has not yet gone Online. This is also true for many post office schemes, where we have to still fill the physical forms and hand them over to the post office.
Especially for senior citizens, the government should have had the online facility, given their age and need to hassle them even less. One is not sure when the Government would ensure that the Senior Citizens Savings Scheme would be enabled Online. In fact, there are many state government owned companies like Tamil Nadu Power Finance, where the fixed deposits can be opened online through the help of an APP.
Should we invest in the Senior Citizens Savings Scheme, though it is not Online?
Senior Citizens today have very limited choices as banks are offering an interest rate of 5.5% only on fixed deposits. Generally interest rates in the economy as a whole are very low. Against this backdrop it makes sense to invest in the scheme given that the interest is much higher at 7.4% per annum. An individual who is over 60 years of age can open this account. However, retired Civilian Employees above 55 years of age and below 60 years of age, subject to condition that investment to be made within 1 month of receipt of retirement benefits. Individuals are also offered a tax benefit under SEC80C of the Income Tax Act.
There is also a cap on the Senior Citizens Savings Scheme and investors cannot invest more than Rs 15 lakhs. The interest is paid every quarter basis and applicable from the date of deposit to 31st March/30th June/30th September/31st December. This is good for investors who are looking to regular income.
It must be noted that a TDS would be applicable in case the interest income exceeds Rs 50,000 every financial year. Investors therefore plan accordingly before investing. All in all this is a good scheme for senior citizens though it is unfortunate that there is no online facility to open an account.