Who can subscribe to SCSS 2004 or Senior Citizen Saving Scheme?

Any individual who is a resident Indian and aged 60 or above can invest in Senior Citizen Saving Scheme (SCSS). Those who have taken voluntary retirement and are 55 years or above can also invest in this scheme. There is no age restriction for those having retired from defence services. The scheme has a maturity period of 5 yrs, which can be extended for another 3 years.

• The interest rate offered is 9% which is much higher than the interest being offered by other fixed income deposits. Fixed Deposit, today, offer interest rates of around 7 to 8 % only.
• More than one account can be opened but with a gap of 1 month. Cumulative investment is limited to Rs 15 lakhs max.
• SCSS also offers a way of saving tax. Investment of upto 1 lakh is exempted under Sec 80 C of Income Tax Act. Hence its works as one of the tax saving investments as well.

Cons of Senior Citizen Saving Scheme

• Interest earned from Senior Citizen Saving Scheme is taxable.
• One cannot avail a loan against this scheme.
• Premature withdrawal is permitted after 1 year but at a cost. If the deposit is closed before 2 completion of 2 yrs, then 1.5 % of the principal amount is deducted as charges.

To know about the list of banks where this scss 2004 can be opened click here.
Learn about nomination facility in this scheme.