The Mahila Samman Savings Certificate Scheme (MSSC) helps empower women for financial freedom and maximum earning. We will discuss the eligibility criteria, deposit options, interest rates, withdrawal procedures, premature closure provisions, maturity terms, and requisite paperwork for opening a Mahila Samman Savings Certificate Scheme account. In this article, we will provide you with a clear understanding of Mahila Samman Savings Certificates.
Quick Summary of Mahila Samman Savings Certificate
This table provides a quick overview of the scheme’s eligibility, interest rates, investment options, and more. This consice summary will help you to understand the concept of Mahila Samman Savings Certificate scheme easily.
| Feature | Details |
|---|---|
| Who Can Apply | Open to all women, including minors |
| Interest Rate | Attractive rate of 7.50% |
| Minimum Deposit | Start with just Rs 1,000 |
| Maximum Deposit | Rs 2 lakh across all accounts |
| Duration | Fixed maturity period of 2 years |
Who can open Mahila Samman Savings Certificate Scheme (MSSC)
The Mahila Samman Savings Certificate Scheme (MSSC) is designed to empower women at different stages of their lives. A closer look at who can begin this journey is as follows:
- Any woman can open the Mahila Samman Savings Certificate Scheme herself.
- Any guardian can open the Mahila Samman Savings Certificate Scheme on behalf of a minor girl.
Deposits
A Mahila Samman Savings Certificate gives you complete control over your savings, offering a range of deposit options to suit your needs. The deposit flexibility is as follows:
- You can deposit a minimum of rupees 1000 and in multiple of rupees 100.
- You can deposit a maximum of 2 lakh in Mahila Samman Saving Certificate Account.
Interest
MSSC offers an attractive interest rate to maximize your earnings.
- The Mahila Samman Savings Certificate Scheme (MSSC) offers an annual interest rate of 7.5%.
- This interest is compounded quarterly, which means that the interest earned on the principal amount is added to the principal every three months, and subsequent interest calculations are based on the new total.
Withdrawal
MSSC account holders have easy access to their funds, which is one of its key advantages. The withdrawal process looks like this:
- After one year from the date of account opening, account holders of the Mahila Samman Savings Certificate Scheme (MSSC) are eligible to make a withdrawal of up to 40% of their eligible balance.
- This means that after the first year, account holders can access a portion of their savings while the remaining balance continues to earn interest.
Pre-mature Closure
The Mahila Samman Savings Certificate Scheme (MSSC) allows for pre-mature closure under certain circumstances, as outlined below:
- Without any Reason: There is a provision for early closure of the account after six months of opening, without the need to provide a specific reason. In such cases, an interest rate of 5.5% will be applied.
- On the death of the account holder: In the unfortunate event of the death of the account holder, the scheme can be closed prematurely. The necessary documentation and procedures, as required by the scheme’s guidelines, would need to be followed by the nominee or legal heir to initiate the closure process.
- On extreme compassionate grounds: Pre-mature closure can also be considered on extreme compassionate grounds. This includes cases such as:
(i) Life-threatening disease of the account holder: If the account holder is facing a life-threatening disease, the scheme might allow for pre-mature closure to provide necessary funds for medical treatment or other urgent needs.
(ii) Death of the guardian: In case of the death of the guardian (for an account opened on behalf of a minor), pre-mature closure may be permitted. Relevant documents would typically need to be submitted to support the closure request.
Maturity
The Mahila Samman Savings Certificate Scheme (MSSC) reaches maturity after a period of two years from the date of opening. Once the two-year period is completed, the eligible balance will be paid to the depositor. This means that at the end of the specified maturity period, the account holder will receive the accumulated funds, including the principal amount and any accrued interest earned over the two-year period.
Mahila Samman Saving Scheme Calculator
Documents Required to Open Mahila Samman Savings Certificate Scheme
These documents are essential for the account opening process and fulfilling the Know Your Customer (KYC) requirements. Here is a summary of the documents needed:
- Application Form: The completed application form for opening a Mahila Samman Savings Certificate account. This form typically contains personal and contact details of the account holder.
- KYC Documents: Documents that serve as proof of identity and address verification. The acceptable KYC documents may include:
- Aadhaar card
- Voter ID card
- Driving license
- PAN card (Permanent Account Number)
- KYC Form for New Account Holders: A separate KYC form specifically designed for new account holders. This form gathers additional information required for compliance and verification purposes.
- Pay-in-Slip: A pay-in-slip or deposit slip for the initial deposit amount. This slip is used to make the initial deposit into the Mahila Samman Savings Certificate account.
Ensure that you provide accurate and valid documents to complete the account opening process smoothly for Mahila Samman Savings Certificate Account.
Taxation Rules
It is crucial that you understand the taxation framework before considering Mahila Samman Savings Certificates.
- Interest and Crediting: The interest accrued through the Mahila Samman Savings Certificates scheme is calculated on a quarterly basis. The calculated interest is then added to the account balance.
- Tax Liability: All income generated from the Mahila Samman Savings Certificates is subject to taxation. The applicable tax will be determined in accordance with the existing income tax regulations in India.
- Tax Deducted at Source (TDS): Unlike some other financial schemes, the Mahila Samman Savings Certificates scheme does not automatically deduct Tax Deducted at Source (TDS) from the interest earnings. As a result, it becomes the account holder’s responsibility to ensure compliance with tax laws and fulfill any tax obligations associated with the interest earned.
Where to Open Mahila Samman Savings Certificate Scheme Account?
The Mahila Samman Savings Certificate (MSSC) scheme is now available for purchase not only at Post Offices but also at qualified Scheduled Banks.. As of April 1, 2023, the Mahila Samman Savings Certificate scheme has been in operation through the Department of Post. This scheme is available for purchase at Post Offices and qualified Scheduled Banks, and it offers an interest rate of 7.5%. Here is the procedure how you can buy or open account.
Opening an Account
To open an account under the Mahila Samman Savings Certificate Scheme (MSSC), follow these steps:
- Submit Account Opening Form: Obtain the Account Opening Form for the MSSC from the nearest Central Bank of India branch or download it from their official website, if available. Fill out the required details accurately and completely.
- Provide KYC Documents: Along with the Account Opening Form, you will need to provide Know Your Customer (KYC) documents. This typically includes your Aadhaar card and PAN card. These documents are used to verify your identity and fulfill regulatory requirements.
- Pay-in-Slip and Deposit: Prepare a pay-in-slip for the deposit amount you intend to invest in the MSSC. You can deposit the amount in cash or provide a cheque drawn in favor of the Mahila Samman Savings Certificate Scheme. Ensure that the deposit amount aligns with the minimum requirement for account opening, if applicable.
- Visit Nearest Central Bank of India Branch: Visit the nearest Central Bank of India branch to submit the completed Account Opening Form, KYC documents, pay-in-slip, and deposit amount/cheque. The bank officials will assist you with the submission process and guide you through any additional requirements.
- Account Opening Process: The bank will process your account opening request and verify the provided documents. Once the account is successfully opened, you will receive an account number and relevant account details.
MSSC vs PPF
The Mahila Samman Savings Certificate Scheme and the Public Provident Fund (PPF) are two distinct financial instruments, each with its own features and benefits.
The Mahila Samman Savings Certificate Scheme is specifically designed to empower women by offering a secure savings avenue. It provides attractive interest rates, with a fixed maturity period of 2 years. The scheme allows women to deposit a minimum of Rs 1,000 and a maximum of Rs 2 lakh across all accounts. Interest is compounded quarterly at a rate of 7.5%, and partial withdrawals are permitted after the first year. The scheme also accommodates premature closure under certain circumstances, making it a flexible savings option.
On the other hand, the Public Provident Fund (PPF) is a long-term savings and investment option offered by the Indian government. PPF has a longer maturity period of 15 years, which can be extended in blocks of 5 years. It is open to both men and women. PPF offers tax benefits under Section 80C of the Income Tax Act and provides compound interest. The interest rate is revised by the government periodically. Partial withdrawals are allowed from the 7th year, and the entire corpus is tax-free upon maturity.
Below is a table summarizing Mahila Samman Savings Certificate Scheme and Public Provident Fund (PPF):
| Feature | Mahila Samman Savings Certificate Scheme | Public Provident Fund (PPF) |
|---|---|---|
| Eligibility | Open to all women, including minors | Open to all individuals |
| Maturity Period | 2 years | 15 years, extendable |
| Minimum Deposit | Rs 1,000 | Rs 500 annually |
| Maximum Deposit | Rs 2 lakh (across all accounts) | Rs 1.5 lakh annually |
| Interest Rate | 7.5% compounded quarterly | at present 7.1% Variable, government-set |
| Partial Withdrawals | Allowed after the first year | Allowed from the 7th year |
| Premature Closure | Allowed under specific circumstances | Not allowed before 5 years |
| Tax Benefits | Not specified | Under Section 80C |
| Taxation on Interest | Taxable | Tax-free |
| Availability | Available through Post Offices and Banks | Available through Banks and Post Office |