Bank of Maharashtra Senior Citizen Savings Scheme

Established in 1935, the Bank of Maharashtra has established itself as one of the major public sector banks in the country with its 85 years of service. In 2016, the bank had about 1897 branches across India, with a plethora of financial products and services for its customers. Among these, the Bank of Maharashtra Senior Citizen Scheme is one of the most prominent investment instruments for retired individuals.

The Senior Citizen Savings Scheme was launched by the Government of India in 2004 to offer a scope of regular income for individuals aged 60 years or above, at attractive interest rates. So far, it provides the highest level of safety to the investments by senior citizen depositors.

Senior citizens can invest under this scheme and enjoy attractive Bank of Maharashtra SCSS interest rates.

Features of Bank of Maharashtra SCSS

Few features of this Senior Citizen Savings Scheme have been indicated below –

• The tenure of the scheme is 5 years, which may be further extended by a period of another 3 years.

• The minimum deposit to be made in this account is Rs.1000, and the maximum limit is Rs.15 lakh.
• Individuals can opt to withdraw from their accounts prematurely in case of emergencies, with applicable penalty charges.

Present Rate of Interest by Bank of Maharashtra

Among all the schemes that allow guaranteed savings, the highest rate of interest is offered under this Senior Citizen Savings Scheme. The rate of interest, applicable under this scheme currently is 7.80%.

The interest rate under the Senior Citizens Savings Scheme is reviewed by the Finance Ministry every quarter. The payment of interest is made on a quarterly basis, that is, paid on the 1st working day of April, July, October and January.

The rate of interest of Senior Citizen Savings Scheme for the previous few quarters is indicated below –

Eligibility to Invest in the Bank of Maharashtra SCSS

Individuals complying with the following criteria can avail the benefits of this SCSS –

• Those attaining 60 years of age.
• Individuals aged 55 years or more, but less than 60 years and have opted for a voluntary retirement scheme or superannuation.
• Retired defence personnel attaining 50 years of age or above.
• The first applicant will have the sole right over the invested amount under the Bank of Maharashtra Senior Citizen Savings Scheme.

However, members of a HUF, POIs and non-resident individuals cannot opt for the benefits offered under this scheme.

Taxability of Senior Citizen Savings Scheme

While the investment made under the Bank of Maharashtra Senior Citizen Scheme qualify for tax benefits, the returns generated from the same is taxable.

When a senior citizen makes an investment in the Senior Citizen Savings Scheme, the individual can avail an income tax deduction benefit up to Rs.1.5 lakh under the Income Tax, 1961, Section 80 C.

The interest received under the Senior Citizen Savings Scheme is wholly taxable. In the instance that the interest generated amounts to more than Rs.50,000 in a financial year, TDS (Tax Deducted at Source) will be applicable on the earned interest.

Comparison between Senior Citizen Saving Scheme and Fixed Deposit 

The table mentioned below indicates the comparison between the Bank of Maharashtra Senior Citizen Scheme with that of the FD offered by the same bank for senior citizens –

How to Apply for the Bank of Maharashtra SCSS?

Application for the Bank of Maharashtra Senior Citizen Scheme can be made online and offline. The account opening form can be downloaded from the bank’s official website or may be obtained from any of the branches.

The form will require the applicant to mention certain specific details –

• Name of applicant
• Permanent Account Number (PAN)
• Name of spouse (if it is a joint account)
• Details of nominee (name, age, address)
• Demand draft/cheque number and amount

After filling up these details, the application form will have to be submitted along with other supporting documents such as identity proof, address proof, age proof, passport size photos etc.

Individuals looking to park their savings in this scheme can easily propagate proper financial planning with these scheme details at their disposal.