By Sushil Tripathi
After retirement, financial stability becomes one of the biggest priorities for most individuals. The Senior Citizens Savings Scheme (SCSS), offered by India Post, provides a simple and reliable way to secure a regular income during your golden years.
Opening an SCSS account is an easy and hassle-free process that can be done at any post office. This government-backed savings plan is designed specifically for senior citizens, ensuring both the safety of your investment and steady returns.
The money deposited under this scheme remains completely safe, as it is guaranteed by the Government of India. The interest earned on your deposit is credited every three months, providing a consistent source of income to meet routine expenses or fulfil post-retirement goals.
What makes SCSS particularly attractive is its high interest payout. A single account can earn up to Rs 61,500 in quarterly interest, offering dependable returns without any market risk. For those seeking a secure, easy-to-manage, and guaranteed return investment option after retirement, the Senior Citizens Savings Scheme remains one of the most trusted and rewarding choices.
How to open an SCSS account?
To open an SCSS account, you need to visit your nearest post office branch and fill out the application form. You can also download the form from the official website. In the form, you must provide all the required details, attach your photograph, and submit the necessary documents such as Identity Proof (PAN Card, Aadhaar Card, or Passport), Address Proof, and Age Proof.
If you are opening the account after VRS (Voluntary Retirement Scheme) or retirement, you will also need to submit the retirement proof issued by your employer along with the proof of retirement benefits. At the time of submitting the form, you will be required to make the deposit payment either through cheque or cash.
SCSS: Rules for deposit
Minimum deposit: You can start with a minimum deposit of ₹1,000, and the amount must be in multiples of ₹1,000.
Maximum deposit: An individual can deposit up to a maximum of ₹30 lakh across all their SCSS accounts combined.
Rules for husband and wife: Both husband and wife can open separate single accounts. In addition, they can also open a joint account together.
In a joint account, the maximum deposit allowed is ₹30 lakh. If both hold separate individual accounts, each can deposit up to ₹30 lakh in their respective accounts.
How interest is paid in SCSS account
The Senior Citizens Savings Scheme (Post Office Senior Citizen Savings Account) currently offers an annual interest rate of 8.2%.
Interest is credited to your account every three months, based on the quarter ending on March 31, June 30, September 30, and December 31 — calculated from the date of deposit.
The credited interest amount is deposited into your savings account on the next day, i.e., on April 1, July 1, October 1, or January 1 respectively.
You can choose to have the interest auto-credited to your savings account, or receive it directly in your bank account through ECS (Electronic Clearing System).
However, if the account holder does not withdraw the interest every quarter, no additional interest will be paid on the unwithdrawn amount.
Interest and return details under SCSS
Annual Interest Rate: 8.2% per annum
Maturity Period: 5 years
Maximum Deposit: ₹30,00,000
Quarterly Interest (every 3 months): ₹61,500
Monthly Equivalent Interest: ₹20,500
Total Interest in 5 Years: ₹12,30,000
Total Maturity Amount (if interest is not withdrawn): ₹42,30,000
Rules for extending SCSS account
You can extend your SCSS account multiple times, each time for an additional period of 3 years. The extension must be done within one year from the date of maturity.
To extend the account, you need to fill out the prescribed form and submit it at the post office. The interest rate applicable for the extended period will be the rate in effect on the date of maturity.
This way, you can continue to enjoy a regular income for several more years through this reliable government savings scheme.
TDS rules
If the total interest earned from all your accounts (including SCSS) in a financial year exceeds the prescribed limit, TDS (Tax Deducted at Source) will be deducted on the interest amount.
However, if you submit Form 15G or Form 15H, depending on your eligibility, no TDS will be deducted from your interest income.
Rules for closing the SCSS account and withdrawal
If the account is closed before completing 1 year, no interest will be paid. If any interest has already been credited, it will be deducted from the principal amount, and the remaining balance will be returned to the account holder.
If the account is closed after 1 year but before 2 years, 1.5% of the total deposit will be deducted, and the remaining amount will be refunded.
If the account is closed after 2 years, 1% of the total deposit will be deducted, and the balance will be returned to the account holder.
If the account has been extended, and it is closed before completing 1 year of the extended period, then 1% of the deposit will also be deducted.
Note: This content has been translated using AI. It has also been reviewed by FE Editors for accuracy.