Senior Citizen Savings Scheme: Individuals under 60 years can open account but with riders

The government has made some exemptions to the Senior Citizen Savings Scheme that allow people below the age of 60  to open an account under the plan, but with some conditions.

Currently, the Senior Citizen Savings Scheme offers an interest rate of 7.4 percent. A person above 60 years of age can easily open an account, which has a term of 5 years that can be extended. It has a maximum investment limit of Rs 15 lakh per individual.

- An individual above 60 years of age.

- Retired defence employees above 50 years of age and below 60 years of age, subject to the condition that investment is made within 1 month of receipt of retirement benefits.

- Retired civilian employees above 55 years of age and below 60 years of age, subject to the condition that investment is made within 1 month of receipt of retirement benefits. Department of Post recently clarified that this rule doesn't specify the category of the employer, whether private sector or government.

- An individual is qualified for the benefit under section 80C of Income Tax Act, 1961, if the investment is under this scheme.

- Interest is paid on a quarterly basis.

- No additional interest shall be earned, if the interest payable every quarter is not claimed by an account holder.

-  A Senior Citizen Savings Scheme account can be prematurely closed any time after the date of opening. If the account is closed before one year, no interest will be payable and if any interest is paid, it shall be recovered from principle.

- From the date of maturity, by submitting the prescribed form with passbook at the post office concerned, an account holder can extend the account for a further period for three years.

- Account can be extended within a year of maturity.