Mahila Samman Saving Certificate Scheme: Eligibility, Application, Calculation, and More
Last Updated : July 14, 2023, 10:56 a.m.
The Mahila Samman Saving Certificate Scheme is a savings scheme exclusively for women in India. The Indian government backs it. This scheme aims to empower women and encourage their economic independence financially. This scheme allows women to make regular deposits and get a predetermined interest on their savings. Also, it offers several benefits, like lower interest rates, tax exemptions, and the liberty to choose the investment amount. This article will discuss the Mahila Samman Saving Scheme and explain the overall process.
Eligibility for Mahila Samman Saving Certificate Scheme
Any adult woman, whether married or unmarried, can open a Mahila Samman Saving Certificate in her name. This scheme presents a chance for women to put away money and safeguard their financial prospects. The caretaker of a minor girl child, like her parents or legal custodian, can initiate a Mahila Samman Saving Certificate on the daughter’s behalf. It enables parents or custodians to save for the girl child’s future expenditures, education, or marriage.
Key Features of the Mahila Samman Saving Certificate Scheme
Now that you know how to apply for the Mahila Samman Saving Scheme, let’s discuss the scheme’s key features.
Supported by the Government
The Mahila Samman Saving Certificate scheme is a savings scheme that the government supports. It implies the scheme offers a secure and dependable investment alternative for women and girls. Since the government endorses it, there is no possibility of default, providing individuals with a sense of security about the safety of their investments.
Deposit Limits
To initiate an account, a minimum sum of ₹1,000 is mandatory. You can make subsequent deposits in multiples of ₹100. The program permits a maximum deposit of ₹2 lakhs in either a single account or across multiple accounts under the same scheme by the same account holder. This flexibility empowers account holders to invest according to their financial capability while optimising their savings.
Maturity
The scheme has a maturity period of two years. It implies that the account will earn interest for the specified period, and the maturity amount will be sent to the account holder two years from the account opening date. This feature lets individuals strategise and save for specific financial objectives or upcoming expenses.
Withdrawal
One of the benefits of the Mahila Samman Savings Certificate plan is the possibility of taking out a part of the savings. After one year from the account’s opening date, holders can withdraw up to 40% of the account balance if needed. This flexibility enables individuals to access a portion of their savings in case of emergencies or unforeseen financial requirements while maintaining the remaining funds’ growth potential.
Tax Benefits
The interest obtained under the Mahila Samman Savings Certificate plan is exempt from Tax Deducted at Source (TDS). Nevertheless, it is crucial to remember that the Central Board of Direct Taxes has notified that TDS will be applicable if the interest obtained from post office savings schemes exceeds a certain threshold.
As long as the interest received on the Mahila Samman Savings Certificate does not exceed ₹40,000 for a maximum investment of ₹2 lakhs over two years, you do not have to worry about TDS deductions. With this facility, you can enjoy full returns on your investment.
Interest Rate
The Mahila Samman Savings Certificate provides a consistent interest rate of 7.5% annually. This rate is greater than what is typically offered by Fixed Deposits in banks and other prevalent small savings programs. The interest is compounded every three months, resulting in better account balance growth and higher overall returns for the account holder. After the scheme is matured, when the account is terminated, the principal amount and the accumulated interest will be sent to the account holder, resulting in an increase in the savings amount.
Calculation of Mahila Samman Saving Certificate
Let’s say you deposit ₹50,000 in a Mahila Samman Savings Certificate account that offers a fixed interest rate of 7.5% per annum. In the first year, you will get an interest of ₹3,750, and in the second year, the interest will rise marginally to ₹4,031 due to the compounding effect.
At the end of two years, the total maturity sum will be ₹57,781, which incorporates your initial investment of ₹50,000 and the accrued interest of ₹7,781. It implies you will get a lump sum payment of ₹57,781 when the two-year period ends.
Application Process for Mahila Samman Saving Certificate Scheme
If you are applying for the scheme, kindly review this segment to understand the process.
- Download the application from Indian Postal Service’s official website. You can also get it from the closest branch of the Post Office.
- Enter the essential information, such as the Post Office address and your name, and select the account type as ‘Mahila Samman Savings Certificate.’
- Provide the required payment and personal details.
- Finish the declaration and nomination sections.
- Present the duly completed form along with the required documents.
- Make the deposit payment at the Post Office by cash or cheque.
- Obtain the Mahila Samman Savings Certificate as evidence of your investment in the plan.
Documents Required for Mahila Samman Saving Certificate Scheme
Remember to carry these documents when applying for the scheme.
Application Form
Complete the given application form for the Mahila Samman Savings Certificate program.
KYC Documents
Provide accurate Know Your Customer (KYC) papers as evidence of your identification and residence. Acceptable papers include an Aadhaar card, Voter ID, driver’s license, and PAN card.
KYC Form
You should finish a separate KYC form with additional details if you are a fresh account holder.
Pay-In-Slip
Submit the Pay-In-Slip along with your deposit amount. The slip verifies the payment made for opening the account.
Conclusion
In conclusion, Mahila Samman Saving Certificate is a progressive step towards improving the scope for financial independence for women. The scheme supports minor and major women. It offers several benefits for them to enhance their lifestyle and become financially independent. Read this information carefully to gain valuable insights into the Mahila Samman Saving Scheme.