Senior citizens have their own set of expectations from the upcoming Budget 2020 which is a challenge for the current government, nonetheless, senior citizens who want to earn good returns on their invested money while also keeping it safe with no devaluation intend that their surplus in bank FDs should be well protected after the recent PMC Bank debacle. Also, at the same time, they look for incentive on health care treatment which in no time has skyrocketed.
So, here we can know how banks can address these concern areas of our senior citizens:
Safety of Deposits at Bank:
RBI extends insurance against bank deposits under the Deposit Insurance and Credit Guarantee Corp. (DICGC) up to a limit of just Rs. 1 lakh, which is rather considered insufficient. Though the problem currently is seen the cooperative banks specifically, RBI's step to lift up the insurance amount will restore the confidence of senior citizens who for ages considered bank FDs to be highly safe and rewarding.
It is suggested that the insured amount should be extended to up to Rs. 15 lakh to Rs. 20 lakh and accordingly seniors can spread their risks across banks.
Improved and Doorstep Banking Service for Senior Citizens: Though, RBI has directed banks to extend doorstep banking service to senior citizens, there have been an array of complaint in this area, with either services being not up to the mark or some of the bank branches not adhering to the practice. Hence it is desired to have a distinct grievance redressal cell that could resolve the complaints raised by senior citizen customers.
Increasing Tax Benefits:
Though various reliefs by way of tax deduction for different medical expenses are provided, they are considered to be inadequate given the rate of inflation. Section 80D provides deduction against health insurance premium as well as for medical check up, Section 80DD provides tax deduction against expenses incurred for disabled person who is insured and Section 80DDB for a specified disease.
Also, it is sought that tax deduction to any of the close relative should also be provided if the person provides for medical treatment of a senior citizen (medical condition be of any nature).
Better investment options that are able to beat inflation: Such that the issue of inflation is well tackled, government should come out with inflation beating investment options for retirees such that they can get handsome returns on safe options. For example: Centre may reintroduce inflation linked bonds. The earlier introduced inflation linked bonds were however not successful as the spread they yield in comparison to inflation was just at 1.5%.
Also, PMVVY scheme which is to close by March 31, is sought to get further extension but with lucrative returns at par with Senior Citizens Savings Scheme (SCSS) that fetches 8.6% currently.