Post Office Saving Schemes: How Senior Citizen Savings Scheme Compares With PPF
From Public Provident Fund (PPF) to Senior Citizen Savings Scheme (SCSS), India Post - which has a network of more than 1.5 lakh post offices across the country - offers a variety of savings schemes. Out of the nine government-run small savings schemes, investment in the 15-Year Public Provident Fund (PPF) and Senior Citizen Savings Scheme (SCSS) currently fetches returns of 8 per cent and 8.7 per cent respectively, according to India Post's website - indiapost.gov.in. (Also read: All you need to know about post office fixed deposit Interest rate, income tax benefits)
Here's a comparison of five key features of Public Provident Fund (PPF) and Senior Citizen Savings Scheme (SCSS) at the post office:
| Features | Post office Senior Citizen Savings Scheme (SCSS) | Post office Public Provident Fund (PPF) |
|---|---|---|
| Eligibility | A post office Senior Citizen Savings Scheme account (SCSS) can be opened by an individual of 60 years of age or above. An individual of the age of 55 years or more but less than 60 years who has retired on superannuation or under a Voluntary Retirement Scheme (VRS) can also open an SCSS account under certain conditions, according to India Post's website. | A Public Provident Fund (PPF) account, can be opened by any individual with cash or cheque. |
| Investment Limit | There can be only one deposit in the SCSS account in multiple of Rs. 1,000 where the maximum amount must not exceed Rs. 15 lakh. | PPF accounts can be opened by an individual with Rs 100 but he/she must deposit a minimum of Rs. 500 in a financial year and maximum of Rs 1,50,000, according to India Post. |
| Maturity | A post office Senior Citizen Savings Scheme (SCSS) account has a maturity period of five years, which can be extended for another three years within one year of the maturity. | PPF accounts mature in 15 years. Thereafter, on application by the subscriber, it can also be extended for one or more blocks of five years each. |
| Interest rate | A post office SCSS account earns interest at the rate of 8.7 per cent per annum, which is payable from the date of deposit on March 31/September 30/December 31 in the first instance, and thereafter, interest are payable on March 31, June 30, September 30 and December 31. | A PPF account fetches interest at the rate of 8 per cent per annum. Interests on deposits are compounded on an annual basis, which means that it is added to the principal amount every year. |
| Premature closure | Under SCSS, premature closure is allowed after one year on deduction of an amount equal to 1.5 per cent of the deposit and after two years on deduction of an amount equal to one per cent of the deposit. | In a PPF account, premature closure is not allowed before 15 years. |
(As mentioned on India Post's website)
India Post offers interest rates to the tune of 4-8.7 per cent on the nine small savings schemes. These include time deposit, recurring deposit, monthly income scheme, Kisan Vikas Patra and Sukanya Samriddhi.
