RBI/2004-05/213
CO.DT.No. 15.02.001/H.3484 - 3520 /2004-05
October 7, 2004
Ashwina 15, 1926 (S)
The Chairman & Managing Director
State Bank of India / Associate Banks
15 Public Sector Banks
Dear Sir,
Banks to operate Senior Citizens savings Scheme
You may be aware that in terms of GOI Notification No.G.S.R.490
(E) dated August 2, 2004, Government have introduced the Senior Citizens Savings
Scheme (SCSS), 2004 with effect from August 2, 2004 through Post Offices. GOI
have now decided to operate the above Scheme through all the branches of Public
Sector Banks which are operating 'PPF Scheme, 1968' (Office Memorandum
No.2-8/2004-NS.II dated 30th September 2004). The involvement of the Agency
banks in operation of above scheme would be on the lines of PPF Scheme, 1968.
We forward herewith 10 copies each of the Notification dated 2.8.2004 and a
copy of Office Memorandum dated 30.9.2004 for your information and necessary
action.
- It may be observed from the Office Memorandum dated 30.9.2004 that GOI have
stipulated the following procedure for operating the Scheme:
- Small Savings agents working under the Standardised Agency System (SAS),
are eligible to mobilize deposits under the scheme and commission @ 0.5%
(half a per cent) of the deposit shall be payable to such agents. The "at
source commission payment system", adopted in case of commission payments
to PPF agents, as envisaged in the Office Memoranda No.18/5/99-NS.II dated
10th February, 2004 and 20th May, 2004 of Government of India, Department
of Economic Affairs, Ministry of Finance will also be applicable to the
agents mobilizing deposits under SCSS. It may be mentioned that SAS agents
were mobilizing deposits under the erstwhile Deposit Schemes for Retiring
Employees.
- Details of accounting procedure for various transactions under the scheme
are under process of finalization. Pending this, the transactions under
the Scheme may be classified as under:-
i) Deposits and withdrawal of principal: Major Head: 8001
- National Savings Deposits: 00.103- Fixed and Time Deposits.
ii) Interest payments to the depositors: Major Head:
8008-Income and Expenditure of National Small Savings Fund:
02- Interest Payments to Subscribers: 101- Interest on National Savings
Deposits.
iii) Commission payable to agents: Major Head: 8008-
Income and Expenditure of National Small Savings Fund: 03 - Management
Cost 103-Payment of Commission to Agents: 02. Payment of commission
by banks: 01- Payment of commission to SAS Agents:
50 - Other charges.
- You are advised to acquaint your designated branches with the
modalities for implementation of SCSS 2004 and also equip them with
the required stationery articles etc. As GOI is keen to operate
the Scheme through Public Sector Banks (PSBs) at the earliest but
not later than 1.11.2004, we advise you to initiate immediate
steps for successful launching and smooth operation of the SCSS -2004.
3. We are also enclosing Annexure I
containing details of the accounting procedure and reporting system to be followed
by the PSBs, for your information and necessary action. The highlights of the
SCSS, 2004 are also furnished in the Annexure II for
your information and necessary action.
4. In view of the above, you are advised to issue suitable
instructions to your Zonal / Divisional / designated branch offices under advice
to us. You are also advised to ensure that the deposits under SCSS - 2004 are
accepted at your designated branches at the earliest but not later than November
1, 2004.
5. Please acknowledge receipt.
Yours faithfully,
(B.B. Sangma)
General Manager
Endt.CO.DT.No.15.02.001/H. 3484 - 3520A/2002-03 of date.
Copy together with copies of its enclosures forwarded for information
and necessary action to:
- the Regional Director, Reserve Bank of India, Central Accounts Section,
Nagpur.
- the Regional Director, Reserve Bank of India, Ahmedabad, Bangalore, Bhubaneswar,
Chennai, Kolkata, Guwahati, Hyderabad, Jaipur, Kanpur, Chennai, Mumbai, Nagpur,
New Delhi, Patna & Thiruvananthapuram.
- Ms. Anuradha Prasad, Director (Budget), Ministry of Finance, Department
of Economic Affairs (Budget Division), Government of India, North Block, Central
Secretariat, New Delhi - 110 001.
(P. Loganathan)
Asstt. General Manager
Encls: As above.
Annexure - I
Senior Citizens Savings Scheme, 2004
1) Participating Banks - It has been decided to operate
the Scheme through all designated branches of Public Sector Banks (PSBs), which
are operating the PPF Scheme, 1968.
2) Reporting & Accounting Procedure for transfer
of funds
A. The branches of PSBs will remit the amount of subscriptions
under SCSS -2004 to their Link Cell at Nagpur on daily basis as per the
extant procedure for credit to the Government Account at Central Accounts Section,
Reserve Bank of India, Nagpur. Further, as per the existing procedure, remittance
of subscription for credit to Government Account beyond 3 days from the date
of receipt would attract penal interest at the coupon rate.
B. The following reporting system will be followed by the
agency banks.
- The designated branches of SBI handling the transactions relating to SCSS,
2004 will report directly or through their nodal branches to their GAD, Navi
Mumbai. The SBI, GAD, Navi Mumbai will consolidate and report branch-wise
and State-wise data to CAS, Nagpur for settlement of funds. The final
record structure for reporting of the transactions relating to SCSS, 2004
may be obtained from our Central Accounts Section, Nagpur.
- Designated branches of Associate banks & Public Sector Banks will report
either directly or through their nodal branches, the transactions under
SCSS - 2004 to their Link Cell at Nagpur.
- The Link Cells of Associate banks & Public Sector Banks in Nagpur will
consolidate and report the State-wise and branch-wise SCSS, 2004
transactions on a daily basis to CAS, Nagpur and settle funds directly
with CAS, Nagpur. The final record structure for reporting of the transactions
relating to SCSS, 2004 may be obtained from our Central Accounts Section,
Nagpur.
- The nodal branches of State Bank of India at district level shall not
accept such reports of Associate Banks and Public Sector Banks and will
not settle funds on account of SCSS, 2004 transactions.
- RBI Offices at Ahmedabad, Bangalore, Bhubaneswar, Kolkata, Guwahati, Hyderabad,
Jaipur, Kanpur, Chennai, Mumbai, Nagpur, New Delhi, and Patna & Thiruvananthapuram
will not accept the reports relating to SCSS, 2004 transactions either
from Associate Banks or Public Sector Banks.
3. The Link Cells of the agency banks at Nagpur/ SBI, GAD,
Navi Mumbai are required to submit a monthly statement to Principal Accounts
Officer, Department of Economic Affairs, Ministry of Finance, Government of
India, New Delhi and to this Department in the first week of the following month
to which the statement relate.
Annexure II
Senior Citizens Savings Scheme, 2004
Tenure of the Scheme |
5 years, which can be extended by 3 more years |
Interest rate |
9% p.a. |
Frequency of computing interest |
Quarterly |
Tax aspects |
Interest is fully taxable |
Investment to be in multiples of |
Rs.1,000 |
Maximum investment limit |
Rs.15 lakh |
Minimum eligible age |
60 years (55 years for those who have retired under a voluntary or a special voluntary scheme) |
Facility of premature withdrawals |
Available after 1 year of holding but with penalty |
Transferability feature |
Not available |
Tradability |
Not available |
Nomination facility |
Available |
Mode of Holding |
Generally single, Joint mode is permitted but only spouses will be allowed to open accounts jointly with beneficiaries. |
Availability of applications forms |
Through the post offices and designated branches of Public Sector Banks |
|