SBI or State Bank of India is one of the largest public sector banks which was established in the year 1955. With a savings bank account, it offers various financial products and services. One of the most popular schemes is SBI SeniorCitizenSavings Scheme.
A Senior Citizen Savings Scheme (SCSS) by SBI is a savings scheme sanctioned by the Indian government that provides the opportunity to the people of age 60 years or above. While this scheme comes with a fixed maturity tenure, an account holder can easily extend it.
Mentioned below is the detailed description of the SBI Senior Citizen Scheme:
All the customers of SBI are eligible to avail the benefits of this scheme and they can enjoy the attractive rate of interest as well. The features and benefits of this scheme are:
Senior Citizen Savings Scheme SBI interest rates are declared by the government of India in advance before every quarter. The applicable interest rates for the current quarter are notified on 01st July 2020 and at present, it is 7.4%.
The most recent rate of interest applies to SBISenior Citizen Savings Scheme and the same is applicable for the entire lock-in period which is five years. In the same manner, the current interest rates will be the ones that are announced while one is extending the tenure of the scheme.
So, the rate of interest on SBI SCSS in September 2020 was 7.4%, deposits that are made in this scheme during this tenure will get a 7.4% rate of interest till September 2025. The rate of interest for the next quarter will not affect the same.
There will not be any cumulative option to pay the interest rate under the Senior Citizen Savings Scheme by SBI. The rate of interest is payable every quarter. The initial interest tranche is paid for the date on which the deposit is made until the end of the quarter and the same applies for every coming quarter.
Here is the list of the interest rates in previous quarters:
|Different Quarters||Rate of Interest (%)|
|Financial Year 2020 – 21 Q2 (July to September)||7.4|
|Financial Year 2020 – 21 Q1 (April to June)||7.4|
|Financial Year 2019 – 20 Q4 (January to March)||8.6|
|Financial Year 2019 – 20 Q3 (October to December)||8.6|
|Financial Year 2019 – 20 Q2 (July to September)||8.6|
|Financial Year 2019 – 20 Q2 (April to June)||8.7|
For availing of the benefits of the SBI SCSS scheme, one has to meet the following eligibility criteria:
An account in the Senior Citizen Savings Scheme by SBI can be opened in any of the branches of the State Bank of India. One has to provide the following documents for opening an SBI SCSS account:
The account holders of the SBI Senior Citizen Scheme can avail of the tax benefits u/s 80C of the IT Act, 1961. As per this act, they can enjoy the tax benefits of over the amount earned of up to Rs. 1.5 Lakhs.
The interest that one earns from this account is completely taxable. If the interest earned through this scheme in one financial year is more than Rs. 50, 000, then it will attract Tax Deduction at Source (TDS).
The State Bank of India has announced a special FD scheme termed as ‘SBI WeCare’ for the senior citizens. This scheme is different than the Senior Citizen Savings Scheme of SBI in many aspects, which are:
|Eligibility||Individuals who are more than 60 years old are eligible to invest in this scheme.||Senior citizens residents who have attained the age of 60 years are eligible to apply.|
|Tenure||5 years maturity period, which can further be extended to three years.||Minimum – 5 years and Maximum – 10 years|
|Tax Benefits||Tax benefits are given u/s 80C of the IT Act, 1961.||Not applicable|
When an account holder wants to close his/her SCSS account before its maturity, then he/she has to fill Form E. However, he/she has to complete at least one year with the following conditions:
The Final Words!
All the individuals who are eligible to invest in this scheme can invest by opening an SBI SCSS account through any branch of SBI. By this investment, he/she can accumulate a substantial corpus.