Senior Pension Insurance Scheme 2023 Varishtha pension bima yojana (senior citizen savings scheme)
Fulfilling the responsibility of social security, the Central Government has once again given a New Year’s gift to the senior citizens of the country through ‘Virishtha Pension Bima Yojana 2017’ (VPBY 2017). Under this scheme, there is a provision of a fixed income for senior citizens. In fact, Senior Pension Insurance Scheme is an investment-based scheme, in which senior citizens will get pension ranging from Rs. 500 to Rs. 5000 every month, depending on the amount invested. The responsibility of the implementation of this scheme has been given to the Life Insurance Corporation of India (LIC of India). Under the scheme, the insurance company will give a guaranteed return of minimum 8 percent for a period of 10 years. Significantly, the Senior Pension Insurance Scheme is a part of the Social Security and Financial Inclusion Program of the government.
Senior Pension Insurance Scheme | Varishtha Pension Bima Yojana
It is noteworthy here that the Finance Minister of the present government Arun Jaitley While presenting the Union Budget for the year 2014-15, the Senior Pension Insurance Scheme was proposed. Before this, the previous Dr. Manmohan Singh’s government first started this scheme in the year 2003-04. manmohan singh biography read here. Although the word ‘insurance’ is attached to the name of this plan, but in reality there is no such thing as death benefit like a traditional insurance policy. In a way, it can be said that it is like a ‘fixed deposit’ made in banks, on which there is a provision to pay a fixed interest. The specialty of Varishtha Pension Bima Yojana, different from bank fixed deposit, is that it has a provision to give more interest than the interest given by the bank. In the current scheme, provision has been made to give minimum 8 percent and maximum 10 percent interest.
Important points of Senior Pension Insurance Scheme (Main Points of VPBY)
- The age limit for the beneficiaries of the scheme has been fixed at 60 years or more.
- There is a provision to take loan after three years of investment in this scheme.
- The loan amount can be up to a maximum of 75 percent of the total investment.
- There is a provision to return the principal amount invested in the scheme at the end of the stipulated tenure of the scheme. If the person dies within the prescribed period, then the principal amount will be returned to the person nominated by him.
- There is a provision for payment of pension in the scheme only through banking platform ECS or NEFT.
- There is no compulsion of any type of health certificate for investing in the scheme.
How will the amount of pension be determined in Varishtha Pension Bima Yojana? (How would be determination of Pension in VPBY) –
Significantly, the Senior Pension Insurance Scheme has been started to provide a fixed pension every month to senior citizens. But in the same proportion as the pension you want under the scheme, you will also have to make a lump sum investment in the scheme. Once you invest in this, you will continue to get pension for the prescribed period of the scheme. Pension will be determined on the basis of interest rate prescribed for the scheme. According to the prescribed scale and fixed interest rate for the scheme so far, if a person wants to get a pension of Rs 500 every month, then he will have to invest Rs 74,627 in the scheme. If he needs Rs 5000 every month, then he will have to increase the investment amount to Rs 7,46,269. If a person wants to take pension on quarterly, half-yearly or annual basis instead of every month, then he can also take it as per his convenience. If the interval of taking pension is more, there is a possibility of a slight increase in the amount of pension. Pension in the scheme will start from the next year of investment.
Other Characteristics of Senior Citizen Saving Scheme –
- Being a special scheme of the Central Government, the possibility of risk in Senior Pension Insurance Scheme is negligible.
- Significantly, in the present era, interest rates are continuously being cut. The rate of interest on fixed deposits of 5 years to 15 years in banks has come down to 7 percent and there is a possibility of further decline in it. In such a situation, the benefit of 8 percent available in the Senior Pension Insurance Scheme can prove to be a better option for senior citizens.
- The biggest feature of this scheme is that even if there is a huge fall in the interest rates, the benefit of 8 percent fixed for the scheme will remain in its place. The reason for this is the guarantee given by the government to the insurance company Life Insurance Corporation of India, under which if there is any loss on the interest front to the insurance company, the government will compensate it on an annual basis.
Senior Citizen Saving Scheme 2017: At a glance –
|Scheme Name||Senior Pension Insurance Scheme 2017 (VPBY 2017)|
|duration of the plan||10 years|
|Nodal Agency of the Scheme||Life Insurance Corporation of India (LIC of India)|
|Age to invest in the scheme||Minimum 60 years and above|
|Guaranteed Returns in the Scheme||8 percent|
|Maximum amount of investment in the scheme||Rs 7,50,000|
|Pension option in the plan||Monthly, Quarterly, Half yearly and Yearly|
|Time limit for investment in the scheme||up to one year from the date of commencement|
|Premature exit option in the plan||Not clear yet.|
After analyzing and looking at the format and provisions of the scheme, it can be finally said that it is a better investment option for senior citizens in terms of returns in the current economic scenario of the country. Apart from this, due to the direct intervention of the central government in this scheme, the possibility of risk in investment is almost negligible. Yes, one drawback of this plan is that there is no provision for accidental death benefit like that available under traditional insurance. But it can be said broadly that this scheme is an excellent New Year gift from the Central Government for the senior citizens of the country and senior citizens must invest in this scheme according to their budget and future needs.
The senior pension insurance scheme was brought by the Manmohan Singh government. change the name of the project Pradhan Mantri Vaya Vandana Yojana has been kept. The Modi government has also made some changes in the budget of 2018.
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