A Guide To Government Savings Schemes Options with Benefits & Details

Numerous government-sponsored savings programs are offered by various financial institutions around the nation. Each plan has its own distinct characteristics, such as eligibility requirements, deposit amounts, and interest rates. To meet the unique requirements of various social groups, the government has created a variety of programs.

While some savings programs target women’s health, others provide unique advantages for older adults. There are also targeted programs created specifically for farmers and employed people.

List Of Government-Backed Schemes

1. National Savings Time Deposit Account

• The four types of time deposits Accounts with terms of 1, 2, 3, and 5 years are available.
• Deposits must be made in multiples of Rs. 100 starting with a minimum of Rs. 1000.
• No upper limit on deposits.
• After six months, an account may be terminated. Simple interest at the POSA rate is due when deposits are prematurely taken from an account after six months but prior to a year.
• The Income Tax Act’s section 80-C allows for a deduction for deposits made into 5-year time deposits.
• (October 1 to December 31, 2023)7.5% (5 years), 7.5% (2 years), 7.5% (3 years), and 6.90 (1 year)

2. National Savings (Monthly Income Account) Scheme

• Minimum of Rs. 1000 in multiples of that. Maximum limits for single accounts are Rs. 9 lakhs and joint accounts are Rs. 15 lakhs.
• The account expires after five years.
• Subject to the maximum amount that may be invested in a single, or joint account, a depositor may run more than one account under this system.
• After one year but before the end of three years, the account may be prematurely canceled with a 2% penalty. If the account is closed before the three-year period has passed, 1% of the initial deposit will be taken out.
• (from October 1 through December 31, 2023) Interest rate- 7.4%

Also Read: Important Government Schemes and Programs Introduced in India 2023

3. National Saving Certificate

• Minimum deposit is Rs. 1000, with subsequent deposits in multiples of Rs. 100.
• The account expires after five years.
• No upper limit on deposits.
• An adult may create a single-holder type account on behalf of a minor or for themselves.
• After turning 10 years old, a youngster may also open a single-holder kind of account.
• Up to three people may create joint ‘A’ type accounts that are payable to both holders jointly or to the survivor.
• Up to three individuals may create joint ‘B’ Type accounts payable to either of the survivors.
• Loans are offered through bank pledges.
• Interest is 7.7% from October 1 through December 31, 2023.

4. Recurring Deposit Account Scheme

• There is no maximum deposit amount under this plan, however, a minimum deposit of Rs 500 is necessary.
• A person has the option of opening the account alone or with another adult. It is possible to open an account on behalf of a minor.
• Additionally, a youngster who has become 10 years old may open the account on their own.
• According to the Income Tax Act, interest earned on an account up to Rs 10,000 can be deducted from income within a financial year.
• A 4% interest rate is offered by the plan.

5. Post Office Saving Account

• Deposits may be made in this scheme starting at just Rs 100 each month with no maximum amount.
• To be eligible for a refund, the depositor must make advance deposits for either six or twelve months.
• The plan account matures in five years. Withdrawals up to 50% of the total are allowed after the account has been open for a year.
• The account can be terminated early after three years for a simple interest payment at the Post Office Savings Account (POSA) rate.
• A five-year RD loan now has an interest rate of 6.7%.

Also Read:  Guide To Government Savings Schemes Options with Benefits & Details