Senior Citizen Savings scheme (SCSS) 2019 has been notified by the ministry of finance that replaces Senior Citizen Savings Scheme Rules 2004 but the same shall not impact the operation of the earlier SCSS rules. In the scheme, maximum and minimum deposit amount is pegged at Rs. 15 lakh and Rs. 1000, respectively. The maturity term of the account is after 5 years.
Key features of SCSS 2019:
Deposit amount: The maximum deposit under the scheme is limited to either retirement benefit or Rs. 15 lakh, whichever is less.
Account opening: To be eligible for opening SCSS account, an individual should have attained 60 years of age as on the account opening date. Also persons aged 55 years and more but less than 60 years who have retired need to open the account within a month of receiving retirement benefits either as PF dues, gratuity, commuted value of pension etc.
Interest payment: The interest will be payable from the deposit date to the end of the respective quarter i.e. March 31, June 30, September 30 or December 31 on the first working day of April or July or October or January, in the first place as the case may be. Thereafter, interest will be payable on the first working day of every quarter. Furthermore, in a case when the interest i.e. payable every quarter is not claimed by the subscriber of the SCSS account, it will not earn any interest payment.
For any period less than a quarter, interest calculation will be made as though number of days in the period * interest for the quarter/total number of days in the quarter.
Interest paid on SCSS account is simple interest and currently it fetches interest at the rate of 8.6%. So, say when you deposit Rs. 15,00,000 in your SCSS account then in 5 years time it will earn 15,00,000*5*8.6/ 100=645000 and as this amount is payable every quarter, SCSS account holder will get a sum equal to 645000/ 20 i.e. 32250 per quarter. And the principal amount will be provided at the time of account maturity.
Extension of SCSS account for 3 more years: SCSS 2019 allow extension of the account after maturity for 3 more years. And on it, you will be paid interest rate that applies on the date of maturity of the account. In another case when the account is not extended after maturity, it will earn the same interest rate as applicable to post office savings account.