Senior Citizen Savings Scheme (SCSS) Interest Rate

Senior Citizen Savings Scheme is a social security scheme that provides a financial safety net to individuals above 60 years of age.

Senior Citizen Savings Scheme Interest Rate

In India, the number of senior citizens above the age of 60 years is estimated to touch 300 million by 2050. In a rapidly urbanising country, they also need more funds to sustain the lifestyle they are familiar with.

Senior Citizen Savings Scheme, a social security scheme, provides retirees with substantial funds to support their funding requirements and make them financially independent. SCSS is one of the highest-earning small savings schemes that currently exist. 

Current SCSS Interest Rate is 8.2%

The significantly high SCSS current interest rate may be the best thing about these accounts; however, they are not the only advantages.

All Senior Citizen Savings Schemes are government-backed, meaning that regardless of which financial institutions they are operated in, the returns will still be the same.

Most private and public sector banks, and India Post offer the advantages of these specific schemes for senior citizens.

Another reason why the scheme is useful is that it acts as a tax-saving instrument for those above 60 years of age.

Historical Trends of SCSS Interest Rates

Here is a brief overview of how the SCSS interest rates have varied over the previous years.

Financial Year

Rate of Interest p.a.

April to June (Q1 FY 2023-24)

8.2%

January to March (Q4 FY 2022-23) 

8%

October to December (Q3 FY 2022-23)

7.6%

July to September (Q2 FY 2022-23)

7.4%

April to June (Q1 FY 2022-23)

7.4%

January to March (Q4 FY 2021-22)

7.4%

October to December (Q3 FY 2021-22)

7.4%

July to September (Q2 FY 2021-22)

7.4%

April to June (Q1 FY 2021-22)

7.4%

October to December 2020 (Q3 FY 2020-21)

7.4%

July to September 2020 (Q2 FY 2020-21)

7.4%

April to June 2020 (Q1 FY 2020-21)

7.4%

January to March (Q4 FY 2019-20)

8.6%

July to September 2019 (Q2 FY 2019-20)

8.6%

April to June 2019 (Q1 FY 2019-20)

8.7%

The SCSS interest rate in 2023 currently stands at 8.2%. This rate is revised once every 3 months and thus is subject to change four times a year

The Reserve Bank of India’s Monetary Planning Committee meets at periodic intervals, and the rates of interest applicable are drawn up based on prevailing economic conditions.

Senior Citizen Savings Scheme Interest Calculation

As an example, let us assume Mr. Sharma has decided to invest Rs. 15 Lakh, the maximum permissible limit, in his SCSS. After the tenure of 5 years, the total earnings (interest + principal amount) will stand at (Rs. 15,00,000*1.086)*5 = Rs. 22.65 Lakh.

Mr. Sharma can also avail of quarterly payments. For example, if he decides to invest Rs. 1 Lakh for 5 years at the current SCSS interest rate, the total maturity amount will be Rs. 1.43 Lakh. Of this, the total interest is Rs. 43,000. The quarterly receivable amount will be Rs. 2, 150.

Who Should Invest in a Senior Citizen Savings Scheme?

Anyone above the age of 60 and wishes to save enough for the years post-retirement is eligible to open an SCSS account. Those who are planning to take advantage of the high SCSS interest rate in 2023, can invest in this scheme.

An SCSS is an investment option for those wishing to think long-term. It is also essential to remember that a senior citizen can also open this account in joint ownership, but only with her or his spouse.

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