Last Update: February 28, 2023, 12:39 IST
As per the scheme, the subscribers will get assured pension payable on monthly basis.
PM- Vaya Vandana Yojana aims to provide protection to senior citizens aged 60 years and above against a possible drop in their interest income due to uncertain market conditions.
Although the government has increased the Senior Citizen Savings Scheme (SCSS) funding cap by Rs. 15 lakh to Rs. 30 lakh, it is to be noted that the Pradhan Mantri Vaya Vandana Yojana (PMVVY), is scheduled to expire on March 31, 2023. Currently, PMVVY allows retirees to invest up to Rs 15 lakh and earn almost risk-free returns. However, so far nothing has been said about its expansion. Consequently, from April 1, 2023, senior citizens will be able to invest an additional Rs 15 lakh in SCSS, which means that the second option of investing Rs 15 lakh in a similar scheme will no longer be available.
Seniors can feel secure because of the Pradhan Mantri Vaya Vandana Yojana (PMVVY), an insurance policy-cum-pension programme. Life Insurance Corporation (LIC) offers this pension plan to meet the need of financial preparation for post-retirement. The scheme was launched in response to the popularity and success of the Varishtha Pension Bima Yojana 2003 (VPBY-2003) and the Varishtha Pension Bima Yojana 2014 (VPBY-2014), aimed at providing senior citizens aged 60 years and above against a security was to be provided. Possible drop in their interest income due to uncertain market conditions.
As per the scheme, the subscribers will get assured pension payable on monthly basis. Only if the investors have given an initial lump sum amount of minimum Rs.1,50,000 and maximum Rs.7,50,000. An investor of Rs 1.5 lakh will get a pension of Rs 1000 per month and an investor of Rs 7.5 lakh will get Rs 5,000 per month.
The government extended the PMVVY, which was earlier available from May 4, 2017, to March 31, 2020, for an additional three financial years till March 31, 2023. For the years 2022-2023 and onwards, the scheme will provide an assured rate. Return of 7.40% per annum, to be reset every year.
benefits
If the pensioner survives the policy term of ten years, the arrears of pension will be paid (at the end of each month as per the mode selected).
In case of death of the pensioner within the policy term of 10 years, the purchase price will be returned to the beneficiary. If the pensioner survives to the end of the policy term of 10 years, then the purchase price and the final pension installments are due. The maximum shareholding allowed is 15 lakhs.
After completion of three policy years, loan facility is available. The loan can be taken up to a maximum of 75 per cent of the purchase price. At regular intervals, the rate of interest applicable on the loan amount will be decided.
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