In a recent move, the government has relaxed regulations for several small savings schemes, including the Public Provident Fund (PPF) and the Senior Citizen Savings Scheme.
The changes include extending the time to open a Senior Citizen Savings Scheme account from one month to three months.
More Time for Opening Accounts
Under the new rules, individuals can now open an account under the Senior Citizens Savings Scheme within three months from the date of receiving retirement benefits.
Previously, this period was limited to one month. Additionally, the interest will be provided at the scheme’s fixed rate on the maturity date or the extended maturity date.
Changes in PPF Premature Closure Rules
For the Public Provident Fund, there have been alterations in the rules regarding premature closure of accounts.
The government’s notification on November 9 introduced the Public Provident Fund (Amendment) Scheme, 2023.
Updates on Premature Withdrawal under National Savings Fixed Deposit Scheme
The rules for premature withdrawal under the National Savings Fixed Deposit Scheme have also been modified.
If an account with a five-year tenure is prematurely withdrawn after four years from the opening date, the interest payable will be at the rate applicable to the Post Office Savings Account.
Previously, in such situations, the interest was given at an acceptable rate for a three-year fixed deposit.
Government Guarantee on Small Savings Schemes
It’s important to note that small savings schemes, including PPF, Senior Citizen, Sukanya Samriddhi, RD, and Kisan Vikas Patra, are guaranteed by the Government of India.
These schemes, operated by post offices and banks, offer varying interest rates.
Currently, the Senior Citizen Scheme and Sukanya Samriddhi offer the highest interest rates at 8.2 percent and 8.0 percent, respectively.