The Union Finance Department has introduced significant changes to small savings schemes like the Sukanya Samriddhi Yojana, National Savings Scheme (NSS), and Public Provident Fund (PPF). These changes, which will take effect from October 1, 2024, are aimed at rectifying errors in account openings and ensuring proper account management.
Overview of the New Rules
Starting October 1, 2024, six new regulations will be implemented, affecting various aspects of the above-mentioned schemes. These rules will particularly impact accounts opened through post offices under these schemes. The Finance Department has issued these new guidelines to address and correct mistakes made during the opening of these accounts. Below are the specific changes:
NSS-87 Accounts
Accounts Opened Before April 2, 1990
- Interest Rates: NSS-87 accounts that were opened before April 2, 1990, will now earn interest at the current scheme rate.
- Second Accounts: Previously, a second account earned 2% interest along with the prevailing Post Office Savings Account (POSA) rate. However, from October 1, 2024, both the first and second accounts will earn 0% interest.
Accounts Opened After April 2, 1990
- Interest Rates: The first account opened after April 2, 1990, will continue to earn interest at the prevailing scheme rate. The second account will earn interest at the current POSA rate.
- New Rule: Starting October 1, 2024, both accounts will earn 0% interest.
PPF Accounts Opened in the Name of a Minor
Interest Rates Applicable to Minor’s Accounts
- According to the new rules, the POSA interest rate will be applicable until the minor reaches 18 years of age. Maturity is counted from the minor’s 18th birthday.
Multiple PPF Accounts
Interest Calculation and Account Management
- Primary Account: If the deposits are within the annual limit, the primary account will earn interest at the scheme rate.
- Merging of Accounts: The balance from any additional accounts will be merged into the primary account.
- Excess Amounts: Any excess amounts will be returned without interest. Furthermore, if more than two accounts are opened, no interest will be paid on these accounts from the date of opening.
Sukanya Samriddhi Accounts
Custody and Account Management
- Guardianship Rules: As per the new rule, accounts opened by non-legal guardians, such as grandparents, must transfer custody to the legal guardians or natural parents.
- Account Closure: Additional accounts opened in violation of the scheme guidelines will be closed if more than two accounts are opened.
Conclusion
These new regulations introduced by the Union Finance Department are aimed at standardizing and correcting the management of small savings schemes. Account holders should review these changes carefully and make necessary adjustments to comply with the new guidelines by October 1, 2024.