Senior Citizen Savings Scheme (SCSS) - Eligibility & Benefits (2024)

The Senior Citizens Savings Scheme (SCSS) was launched with the main aim of providing senior citizens in India with a regular income after they attain the age of 60 years old. Some of the main benefits of the scheme are:

1. Tax benefits are provided.
2. Safe to invest in the scheme.
3. Premature withdrawal is allowed.
4. The account can be transferred across the country
5. High interest rates are offered

The scheme comes with various security features and provides individuals with a savings option for the long run. The SCSS is available at post offices and certified banks across the country.

Process to Open an SCSS Account

An SCSS account can be opened at a bank or a post office. The process to open an SCSS account is mentioned below:

1. Visit the nearest post office or bank branch.
2. Submit the application form along with the Know Your Customer (KYC) documents.
3. A cheque for the amount that is being deposited must be provided.
4. You can add nominees to the account.
   

SCSS Eligibility

The eligibility criteria for the SCSS are mentioned below:

1. An individual who has attained the age of 60 years or above at the time of opening an SCSS account.
2. Individuals who have reached the age of 55 years old but are below the age of 60 years old and have retired on superannuation are eligible to open an SCSS account.
3. Individuals who have attained the age of 55 years old and have retired before the implementation of the SCSS rules are eligible under the scheme.
4. Non-Resident Indians (NRIs) are not eligible to open an SCSS account.
5. Hindu Undivided Families (HUF) are not eligible to open an SCSS account as well.

SCSS Interest Rate

Currently, the SCSS interest rate is 8.20% p.a. The returns of the SCSSare high when compared to savings and Fixed Deposit (FD) accounts. On the first instance, the interest is payable on the deposit date of March 31, September 30, and December 31, thereafter, interest is payable on March 31, June 30, September 30, and December 31.

Quarterly interest is paid on the initial working day of April, July, October, and January. However, quarterly interest payments are available only at Core Banking enabled post offices.

How SCSS works?

Here are the details about how SCSS operates:

1. In a single instalment open an SCSS account by contributing of Rs.1000 to up to Rs.30 lakh

1. The amount should be deposited within one month from the date of receiving the retirement benefit from the employer
2. Any payment due to the accountholder on superannuation or otherwise on the account of retirement is the retirement benefit, which includes the following:

1. Retirement or superannuation gratuity
2. Leave encashment
3. Retirement-cum-withdrawal benefit under the Employees’ Family Pension Scheme

1. Ex-gratia payments under a voluntary or a special voluntary retirement scheme
2. Provident fund dues
3. Commuted value of pension
4. Savings element of Group Savings Linked Insurance Scheme payable by the employer on retirement

1. The excess will be refunded immediately to the accountholder in case the deposit is more than ceiling amount

1. Accountholder will receive interest once in every quarter
2. The interest can be withdrawn through ECS (Electronic Clearing Service) or auto credit mode through post office
3. After the date of account opening, the account can be closed anytime prematurely
4. From the date of maturity, the account can be extended for another three years
5. The extension of the account can be done one year from the date of maturity

Benefits of SCSS

The following are the benefits of SCSS:

1. The SCSS account can be opened easily at any post office or auhorised banks in the country
2. SCSS is considered safe and reliable as it is government-sponsored investment scheme
3. The scheme offers high rate of interest

1. The tenure of the SCSS account is five years which can be extended up to another three years
2. The account can be transferred anywhere across the country
3. Under Section 80C of the Indian Tax Act 1961, income tax deduction can be availed for this scheme of up to Rs.1.5 lakh

Documents required to open SCSS account

Given below are the documents that individuals must submit in order to open an SCSS account:

1. Two passport-size photographs
2. Form A must be completely filled in and submitted.
3. Identity proof such as Passport or Permanent Account Number (PAN) Card must be submitted.
4. Individuals must submit proof of address such as Aadhaar Card or telephone bill.
5. A document confirming the individual's age must be submitted. Age proof document can be the Permanent Account Number (PAN ) Card, Voter ID, Birth Certificate, Senior Citizen Card, or Passport.

All the documents that are submitted to open an account must be self-attested.

SCSS Features

The main features of the Senior Citizens Savings Scheme are mentioned below:

1. Maturity of the scheme: The maturity period of the scheme is five years. However, individuals can extend the maturity duration for three years by submitting an application in the required format within one year of maturity of the account. However, the account can be closed without any charges after the expiry of the account.
2. Nominations: Nominations can be added to the policy at the time of opening an account or after the account has been opened.
3. Number of accounts: Individuals are allowed to operate more than one account by themselves or open a joint account with their spouse. However, joint accounts can be opened only with the spouse and the initial depositor is the investor of the joint account.
4. Minimum and maximum amount: Only a single deposit is allowed to be made in the account. It can be in the multiples of Rs.1,000 and the maximum amount that can be deposited is Rs.30 lakh. Deposit amounts less than Rs.1 lakh can be paid by cash, while amounts more than Rs.1 lakh must be paid by cheque. In the case of cheque payments, the date the cheque realises will be the opening date of the account.
5. Transfer of an account: An SCSS account can be transferred from a bank to a post office and vice versa. The process to open an SCSS account is also easy and hassle-free.
6. Premature withdrawal: After one year of opening the account, premature withdrawal is allowed. However, a 1.5% charge and a 1% charge of the total amount deposited will be charged in case of premature withdrawals after one year and two years, respectively.

Tax benefits under the SCSS

Under Section 80C of the Income Tax Act, 1961, individuals are eligible for tax deductions on investments up to Rs.1.5 lakh. In case the interest generated is more than Rs.10,000 p.a., the tax will be deducted at source.

Process to Fill the SCSS Application Form - Post Office

The procedure to fill the SCSS application form in case you wish to open an account at the post office is mentioned below:

1. Enter the branch name.
2. In case you have a savings account at the post office, the account number must be entered.
3. Enter the post office address.
4. The name of the account holder must be entered.
5. The next section must be filled if you want to open a savings account.
6. Choose the type of account holder.
7. Choose the type of account.
8. In the section, details of the amount that is being deposited must be entered.
9. Enter the account holder/holders' details.
10. Choose the documents that you will be submitting.
11. Enter nominee details in the next section.

How to open a SCSS account with a Bank

Follow the instruction given below to open an SCSS account with a Bank that offers SCSS

Step 1: Go to the bank (SCSS list) branch that is closest to you.

Step 2: Ask for an application form and fill in the necessary information.

Step 3: Include any necessary supporting documentation with your application, such as a letter from your employer confirming the pension/retirement payments you have received.

Step 4: Hand over the necessary paperwork and deposit money to the bank staff.

Step 5: The bank employees will handle the processing of your application and your payment. The SCSS account will be created after the payment has been processed.

How to fill in the Post Office SCSS application form?

Here are the steps to fill the Post Office SCSS application form:

1. Enter the Post Office branch name
2. Enter the account number if you already have the savings account with Post Office
3. Enter the branch address of the Post Office under the ‘To’ section
4. Paste the photograph of the accountholder
5. Enter the name of the accountholder and tick on SCSS option

1. Only if you are applying to open a savings account, select any options provided under the ‘Additional Facilities Available’ section
2. Select accountholder type, such as minor through guardian, person of unsound mind through guardian, or self
3. Select the account type, such as single, survivor, or all
4. Enter deposit amount both in figures and in words
5. Enter the cheque number and date in case the deposit is made through cheque

1. Enter the accountholder’s personal details
2. Tick the boxes at the end of the table for the documents that you have provided as requested
3. Enter the details of the SCSS and tick the declaration box
4. Accountholder must sign on both page one and two
5. Enter the details of the nominee and provide ethe accountholder’s signature to validate the details mentioned about the nominee

How to open an SCSS account with a Bank?

The following are the steps to open SCSS account with a bank

1. Visit the nearest branch of the participating bank
2. Collect the SCSS application form
3. Fill in all the required details in the application form

1. Attach the photocopy of all the required documents
2. Submit the dully filled application form, documents, and the deposited amount to the bank staff
3. The application will be verified and processed, after which SCSS account will be opened

List of banks that offer SCSS

Given below is the list of banks that of the scheme:

1. ICICI Bank
2. Union Bank of India
3. UCO Bank
4. Indian Bank
5. Punjab National Bank
6. IDBI Bank
7. Indian Overseas Bank
8. State Bank of India
9. Dena Bank
10. Central Bank of India
11. Canara Bank
12. Corporation Bank
13. Bank of India
14. Bank of Baroda
15. Bank of Maharashtra

PAN and Aadhaar Mandatory to Open SCSS Account

1. When opening an account, you must present proof of your application for Aadhaar or enrolment ID if you were not assigned an Aadhaar. You also need to provide the Accounts Office with your Aadhaar number within six months of the account's opening date.
2. If you currently have an active SCSS account and are yet to submit your Aadhaar number, you have until 1 April 2023, to do so. Furthermore, if you failed to submit your PAN when you opened the account, you must do so within two months of the earliest of the following events:

1. The account balance at any given time exceeds Rs.50,000
2. The total amount of withdrawals and transfers made from the account in a given month exceeds Rs.10,000
3. When all of the account's credits combined in a given financial year surpass Rs.1 lakh

1. If Aadhaar is not submitted within six months, and PAN is not submitted within the allotted period of two months, the account will become inactive until the Aadhaar number and/or PAN are provided to the accounts office.