The Centre has recently revised the interest rates applicable to small savings schemes for the quarter of January-March 2024. Though it didn’t revise the interest rates for Senior Citizens Savings Scheme, the government-back scheme offers one of the best competitive rates to Indian residents aged above 60 years. Here’s a quick comparison of Senior Citizens Savings Scheme vs bank fixed deposits meant for senior and super senior investors.
Read More: Investment ideas: Term deposits vs Fixed deposits. What is the basic difference?
Senior Citizen Savings Scheme
> The Senior Citizen Savings Scheme is specifically meant for senior citizens under which they can earn 8.2% interest rate.
> One can start with as little as Rs 1,000 or go up to Rs 30 lakh. It offers tax exemptions of up to Rs 1.5 lakh under Section 80C of the Income Tax Act.
> Since SCSS is a government-backed investment scheme, it gives guaranteed returns on a quarterly basis.
> While the current SCSS Interest Rate is just 8.2%, there was a time when this scheme used to offer 9.3% interest.
> The deposit limit was Rs 15 lakh. In FY 2023-24, the Government has increased the SCSS deposit limit to Rs 30 lakh for an individual.
> Maturity period is 5 years and can be extended for a further period of 3 years.
> There is no age limit for the retired personnel of Defence services provided they fulfill other specified conditions.
> TDS is deducted at source on interest if the interest amount is more than Rs 10,000/- per annum.
> Non-resident Indians (NRIs) and Hindu Undivided Family (HUF) cannot open an account.
> A few new rules:
Under SCSS, investments through retirement benefits can be made within three months from the date of retirement benefits.
Spouses of retired Government employees who age fifty-five years old and died in harness can invest in the scheme irrespective of age.
The SCSS account can be done extended for a block period of three years multiple times till the death of the depositor.
Extended accounts can be closed prematurely before one year subject to the deduction of l% of the deposit amount.
Read More: Green Deposits: RBI Releases Latest Guidelines For Banks, NBFCs
SCSS vs Bank FDs
Some banks have been offering better fixed deposit rates to senior and super senior citizens. Here’s the list.
None of the public sector bank offers 8.2 per cent FD rates to the senior citizens. Here are the best rates:
> Bank of Baroda 7.75%
Bank of India 7.75%
Bank of Maharashtra 7.50%
Canara Bank 7.75%
Central Bank of India 7.65%
Indian Bank 7.75%
Indian Overseas Bank 7.60%
Punjab National Bank 7.75%
Punjab & Sind Bank 7.90%
State Bank of India 7.60%
UCO Bank 7.55%
Union Bank of India 7.75%
Best FD Interest Rates for Senior Citizens by Private Sector Banks
Axis Bank 7.75%
Bandhan Bank 8.35%
City Union Bank 7.50%
DBS Bank 8.00%
DCB Bank 8.60%
Dhanlaxmi Bank 7.75%
Federal Bank 8.00%
HDFC Bank 7.75%
ICICI Bank 7.65%
IDBI Bank 7.65%
IDFC First Bank 8.00%
IndusInd Bank 8.25%
J&K Bank 8.00%
Karnataka Bank 7.65%
Kotak Mahindra Bank 7.75%
Karur Vysya Bank 8.00%
Nainital Bank 7.55%
RBL Bank 8.50%
SBM Bank 8.75%
South Indian Bank 7.90%
Tamilnad Mercantile Bank 7.50%
FD Rates by Small Finance Banks
AU Small Finance Bank 8.50%
Capital Small Finance Bank 8.25%
Equitas Small Finance Bank 9.00%
ESAF Small Finance Bank 9.00%
Fincare Small Finance Bank 9.21%
Jana Small Finance Bank 9.00%
North East Small Finance Bank 9.25%
Shivalik Small Finance Bank 8.60%
Suryoday Small Finance Bank 9.10%
Ujjivan Small Finance Bank 8.75%
Unity Small Finance Bank 9.50%
Utkarsh Small Finance Bank 9.10%
