Announced during the Union Budget of 2023-24 by Finance Minister Nirmala Sitharaman in February, Mahila Samman Savings Certificate finally was launched from April 1, 2023. Mahila Samman Savings Certificate (MSSC), the new small savings scheme for women, received over 5 lakh depositors within just two months of its launch in April 2023. The scheme would be available for a two-year span through March, 2025.
The Mahila Samman Scheme is aimed at women’s empowerment by improving their involvement in investments and promoting their financial awareness. And that purpose has been fulfilled because the scheme has received a great response of over half a million registrations in the first two months of its introduction. In the next couple of weeks, the number of enrolments has reached over a million. The scheme was initially only provided by India Post. The accounts are going to further increase at a rapid rate as all public sector and private sector banks have now been authorised to implement the scheme from June 27 onwards.
Tenure and the key features of MSSC
The Mahila Samman Savings Certificate provides women with a one-time scope to venture into an investment plan with high-yielding returns. Under this scheme funds can be invested for a fixed tenure of two years from the date of opening the account. However, the scheme also allows a partial withdrawal facility by giving women an opportunity to access a portion of their invested amount before its maturity.
The main features of the scheme are as follows,
- The scheme is exclusively for women investors only. So any woman above eighteen years can invest in it herself. Also, minor girls are eligible for this scheme, in case their guardians invest in it on their behalf.
- A minimum amount of Rs. 1000, to a maximum limit of Rs 2 lakh can be invested.
- Account can be opened under this scheme from April 1, 2023 till March 31, 2025 for two years, at an interest rate of 7.5% /annum which will be compounded quarterly. Hence, the effective interest rate will be about 7.7%.
- It supports a partial withdrawal facility during the scheme tenure. The account holder can withdraw a maximum 40% of the balance amount in the scheme account.
How this scheme improves the NSSF collections
National Small Savings Fund (NSSF) is a fund body that collects all the deposits from various Small Savings Schemes like MSSC. The claims made by depositors under Small Savings Schemes are withdrawn from this collective fund.
MSSC scheme has already accumulated about Rs.6000 crore from 1.026 million enrolments till June and aims at a faster rate of fund collection in the upcoming months. The strong and positive response to this scheme is sure to raise fund collection under NSSF and facilitate the government’s fiscal deficit coverage.
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