The amended Senior Citizen’s Savings (Fourth Amendment) Scheme, 2023, now allows depositors to extend their accounts multiple times upon maturity to benefit from its attractive interest rates for a longer period. The ministry has also amended the rules to allow premature closure of PPF account and changed the rules governing premature withdrawal under the National Savings Time Deposit scheme.
Earlier, depositors under the Senior Citizen Savings Scheme could renew the deposit under the scheme only once for just three years; now they can do it multiple times in blocks of three years. This scheme offers an interest rate of 8.2% for the ongoing quarter ending December.
The finance ministry has also allowed people to open such accounts within three months of receiving retirement benefit instead of just one month earlier, in a bid to woo more depositors. Spouses of government employees who die in harness after the age of 55 will now be allowed to open an account under this scheme, subject to certain riders.
According to the amended PPF scheme, an account holder will be allowed premature closure of his account or the account of a minor or person of unsound mind of whom he is the guardian. In such cases, the depositor will be eligible for an interest rate that would be 100 basis points lower than the rate that has been credited into his account from time to time since the date of its opening, or from the date of the commencement of the current block period of five years.
Under the National Savings Time Deposit scheme, if a deposit in a five-year account is withdrawn prematurely after four years, interest would now be payable at the rate applicable to Post Office Savings Account. Prior to this, depositors were entitled to the rate applicable to a three-year Time Deposit account in case of such withdrawals. The amended Senior Citizen Savings Scheme is applicable from November 9, the Department of Economic Affairs said in a notification.
