The Hindu : National : Designated post offices to operate senior citizens scheme

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Wednesday, Aug 04, 2004

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National

Designated post offices to operate senior citizens scheme

By Our Special Correspondent

NEW DELHI, AUG. 3. The Government has notified the Senior Citizens Savings Scheme with effect from August 2 and it would be available initially through designated post offices.

Citizens who have reached the age of 60 years and above on the day the account is opened are eligible to invest. Persons who have retired under a voluntary or a special voluntary retirement scheme and have attained the age of 55 years are also eligible, subject to the condition that the account is opened within three months of retirement. A certificate from the employer indicating the fact of retirement and other terms and tenure of employment should also be produced.

Non-transferable

Investments in the scheme can be single or a joint account, but with spouse only and the deposit would be non-tradable and non-transferable. However, nomination facilities would be available and in case of death of the depositor and where the spouse is the sole nominee, the deposit can be continued on the same terms and conditions.

Deposits in the scheme would be one time and in multiples of Rs. 1,000, subject to a maximum of Rs. 15 lakhs and would carry an interest of nine per cent per annum, payable quarterly, and which would be taxable. The maturity period would be five years, extendable by another three years.

Premature withdrawal

Premature withdrawal after one year would be allowed, subject to some deductions. If the account is closed after one year, a deduction of 1.5 per cent of the deposit will be made.

If the account is closed after two years, a deduction of one per cent of the deposit will be made.

Non-resident Indians and Hindu undivided families are not eligible to invest in the scheme.

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