New Rules for Small Savings Schemes: Key Insights on PPF and More
Wednesday, 4 September 2024, 21:08
Understanding the New Rules for Small Savings Schemes
The Ministry of Finance has recently unveiled informative guidelines related to the regularisation of irregular accounts within the framework of various National Small Savings Schemes. The focus is particularly significant for accounts under the PPF and Sukanya Samriddhi Yojana. Below are the vital elements that everyone should be aware of:
Categories of Irregular Accounts
- NSS-87 Accounts: For accounts opened before April 2, 1990, the first account will yield the prevailing scheme rate, while the second receives a higher rate. For accounts established after this date, only the first account will earn interest, and both must comply with annual deposit limits. Starting October 1, 2024, these accounts will earn no interest.
- PPF Accounts for Minors: These will earn POSA interest until the minor turns 18. Upon reaching 18, the account will earn the applicable scheme interest.
- Multiple PPF Accounts: The primary account will continue to earn the scheme rate. However, any excess balance in secondary accounts will be subject to zero interest.
- NRI PPF Accounts: For account holders who transition to NRI status, POSA interest will be applicable until September 30, 2024, thereafter reducing to zero interest.
- Small Savings Accounts for Minors: Other than PPF and SSA, these will earn simple interest at the POSA rate.
- Sukanya Samriddhi Accounts Opened by Grandparents: Guardianship will now move to the legal guardian, mandating the closure of additional family accounts.
Financial institutions and post offices must comply with these guidelines to maintain proper account integrity and efficiency.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.