Govt Relaxes Norms For Some Small Savings Schemes Including PPF

The Centre government has eased regulations for several small savings schemes, such as the Public Provident Fund (PPF) and Senior Citizen's Savings Scheme.

Under the updated norms for the Senior Citizen's Savings Scheme, individuals now have three months, compared to the current one month, to open an account.

According to the gazette notification dated 9 November, an individual can open an account within three months from receiving retirement benefits and providing proof of the disbursal date.

The deposited amount in such an account will accrue interest at the applicable rate on the maturity or extended maturity date, as per the notification.

Regarding the Public Provident Fund, the notification introduces changes related to premature account closure, termed the Public Provident Fund (Amendment) Scheme, 2023. Additionally, modifications have been made for premature withdrawal under the National Savings Time Deposit scheme.

If a deposit in a five-year account is withdrawn prematurely after four years, interest will be payable at the Post Office Savings Account rate, as per the notification.

Previously, closing a five-year Time Deposit account after four years would apply a rate for a three-year Time Deposit account for interest calculation. Small savings schemes, managed by the Department of Economic Affairs under the finance ministry, offer various investment avenues.

Currently, the government provides nine types of small saving schemes, including Recurring Deposit (RD), Public Provident Fund (PPF), Sukanya Samriddhi Yojana (SSY), Mahila Samman Saving Certificate, Kisan Vikas Patra, National Savings Certificate (NSC), and Senior Citizen Savings Scheme (SCSS).