Mahila Samman Bachat Patra Yojana in English: Eligibility, Interest Rate, Maturity, Tax benefits, and How to Open Account?

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Here is a detailed discussion on “Mahila Samman Bachat Patra Yojana in English“. After reading this article you will know about Mahila Samman Bachat Patra Yojana including other vital information such as Eligibility, Interest Rate, Maturity, Tax benefits, and How to Open an Account?

Introduction

▪ The Union Finance Minister (FM), Smt. Nirmala Sitharaman announced a new small savings scheme for women and girls called the Mahila Samman Saving Certificate Scheme in the Budget Speech for 2023-24.

▪ This scheme, which commemorates the Azadi ka Amrit Mahotsav, will be available from April 2023 to March 2025.

▪ Under this scheme, women and girls can deposit a maximum of Rs.2 lakh for a period of two years at a fixed interest rate.

▪ During her budget speech, the FM announced that the interest rate for the Mahila Samman Savings Certificate would be 7.5%.

Announcement of FM Nirmala Sitharaman

▪ According to Sitharaman, “For commemorating Azadi Ka Amrit Mahotsav, a one-time new small savings scheme, Mahila Samman Savings Certificate, will be made available for a two-year period up to March 2025. This will offer a deposit facility of up to Rs.2 lakh in the name of women or girls for a tenor of 2 years at a fixed interest rate of 7.5 percent with a partial withdrawal option. “

What is a Small Savings Scheme?

▪ Small savings schemes are investment tools that are managed by the government with the aim of promoting long-term savings among citizens.

▪ Some of the well-known investment options that come under the purview of these schemes include the Public Provident Fund (PPF), Senior Citizens Small Savings Scheme (SCSS), National Savings Certificate (NSC), and Sukanya Samriddhi Yojana (SSY).

▪ These schemes, offer fixed returns, and tax benefits, and are backed by the government. As a result, they have become a popular choice among investors.

Features of mahila samman saving scheme

Mahila Samman Savings Certificate scheme was launched by:

▪ The Mahila Samman Savings Certificate is a small savings scheme supported by the government with the objective of providing financial security, promoting economic growth, and creating social welfare benefits for girls and women. Since it is a government-backed scheme, there is no credit risk associated with it.

☛  A government-backed scheme is a program or initiative that is supported, guaranteed, or administered by the government. 

☛ The main aim of such schemes is to provide financial security, promote economic growth, and create social welfare benefits. 

☛ Examples of government-backed schemes include various small savings schemes, insurance schemes, pension schemes, and loans provided by government banks or financial institutions. 

☛ Government-backed schemes often come with certain benefits such as low-interest rates, tax benefits, or a guaranteed return on investment. As such, these schemes are often viewed as a safe and reliable investment option by individuals and businesses alike.
Mahila Samman Saving Certificate Scheme
Mahila Samman Saving Certificate Scheme

Eligibility

▪ Only a girl child or woman can apply for the Mahila Samman Savings Certificate scheme.

Interest Rate

▪ Under this scheme, a fixed interest rate of 7.5% will be offered, which is considerably higher than the interest rates provided by most bank fixed deposits (FDs) and other commonly known small savings schemes.

Deposit Limits

▪ The Mahila Samman Savings Certificate allows deposits starting from Rs.1000 to a maximum of Rs.2 lakhs

Tenure

▪The Mahila Samman Saving Patra is a new one-time small saving scheme for women and girls, and the deposit facility for it will be available for a period of two years between 2023 and 2025.

Premature Withdrawal

▪ The Mahila Samman Saving Certificate scheme allows for partial withdrawals.

☛ Partial withdrawal refers to the ability to withdraw a portion of the funds invested in a financial instrument or account, leaving the remaining funds untouched. 

☛ This means that the investor can withdraw only a portion of their investment, while the balance continues to earn interest or remain invested. 

☛ Partial withdrawals are often allowed in long-term investment options such as insurance policies, mutual funds and pension plans, subject to certain conditions. 

☛ This flexibility allows investors to meet unexpected financial needs without having to abandon their entire investment. However, it is important to note that partial withdrawals may attract certain charges or penalties and may also affect the overall performance of the investment.

Tax Benefits

▪ Small savings plans typically qualify for tax benefits under Section 80C. However, the taxation structure for the Mahila Samman Savings Certificate scheme has not been specified yet.

▪ Small savings plans such as Public Provident Fund (PPF), Senior Citizens Small Savings Scheme (SCSS), National Savings Certificate (NSC), and Sukanya Samriddhi Yojana (SSY) are popular investment options that provide tax benefits to investors who qualify under Section 80C.

▪ It is important to note that the tax implications of the Mahila Samman Savings Certificate scheme are currently unknown.

Premature Withdrawal

▪ Partial withdrawals are allowed in the Mahila Samman Saving Certificate scheme, and deposits can be made in the name of either a woman or a girl child, as permitted by the Indian government.

How to open an account in the Mahila Samman saving scheme?

▪ To apply for the Mahila Samman Savings Certificate scheme, collect the application form from your nearest bank or post office offering the scheme.

▪ Fill in the required personal, financial, and nomination details in the application form.

▪ Submit the form along with the necessary documentation, such as proof of identity and address.

▪ Choose the deposit amount and make the payment in cash or by check.

▪ Upon completion of the process, you will receive a certificate as evidence of your participation in the Mahila Samman Savings Certificate scheme.

Mahila Samman Savings Certificate Calculation

▪ Let us explore the advantages of investing in the Mahila Samman Savings Certificate scheme. Suppose you invest Rs. 2,00,000 in the scheme for two years, with a fixed interest rate of 7.5% per annum.

▪ In the first year, you will earn Rs. 15,000 as interest on the principal amount, and in the second year, you will earn Rs. 16,125. Therefore, at the end of two years, you will receive a total of Rs. 2,31,125 (Rs. 2,00,000 initial investment + Rs. 31,125 as interest for two years).

Benefits of the Scheme

▪ Under Mahila Samman Saving Certificate Scheme, the following benefits will be given to the beneficiaries –
▪ The interest rate of 7.50 percent on deposits.
▪ Maximum deposit limit up to Rs. 2 Lakh.
▪ The deposit is only for a maximum period of 2 years.
▪ A beneficiary can withdraw the amount anytime before 2 years.


Other Small Savings Schemes

▪ The government has launched several small savings schemes that serve as investment tools for individuals. Some popular schemes include the

Mahila Samman Bachat Patra Yojana 2023 Overview

Scheme Name (English) Mahila Samman Saving Certificate Scheme
Scheme Name (Hindi) Mahila Samman Bachat Patra Yojana
Launched By Government of India
Launched Year 2023
Beneficiaries Women and Girls
Interest Rate 7.5%
Deposit Limit Minimum Rs. 1000
Maximum Rs. 2 Lakh
Tenure 2 years ( 2023 – 2025)
Starting Date 01.04.2023
Finish Date 31.03.2025
Withdrawal limit Premature or Partial Withdrawals allowed

Mahila Samman Savings Certificate Scheme Vs. Other Small Savings Schemes

▪ We will now compare the Mahila Samman Savings Certificate with other small savings schemes to understand the different features of each scheme, such as interest rates, tax benefits, deposit limits, tenure, eligibility criteria, and more.

Features Mahila Samman Savings Certificate Public Provident Fund (PPF) National Savings Certificate (NSC) Senior Citizens Small Savings Scheme (SCSS) Sukanya Samriddhi Yojana (SSY)
Eligibility Women and girl children Any individual Indian citizen Any individual, including NRIs Senior citizens aged above 60 years Only in the name of a girl child before she attains 10 years
Interest Rate 7.5% 7.1% 7.0% 8% 7.6%
Tenure 2 years 15 years 5 years 5 years 21 years from opening the account or when the girl child attains 18 years
Deposit Limit Minimum – Rs 1000
Maximum – Rs.2 lakh
Minimum – Rs 500
Maximum – Rs 1.5 lakh
Minimum – Rs.100
Maximum – No limit
Minimum – Rs.1,000
Maximum – Rs.30 lakh
Minimum – Rs.250
Maximum – Rs.1,50,000
Premature Withdrawal Allowed Permits partial withdrawal after 7 years  Allowed in certain circumstances Can be closed at any time Allowed under certain circumstances
Tax Benefit Not yet specified Exempt-Exempt-Exempt (EEE) category under Section 80C categoryDeductions of up to Rs.1.5 lakh under Section 80C Deductions of up to Rs.1.5 lakh under Section 80C Exempt-Exempt-Exempt (EEE) category under Section 80C category

Frequently Asked Questions (FAQs)

Q1. What are the benefits of Mahila Samman Saving Certificate Schemes?

Answer:
• The scheme allows women to open a savings account with a government-owned bank.
• Women need to deposit a minimum amount every month.
• The deposit is eligible for a fixed interest rate, which is higher than that of a regular savings account.
• The deposit is also eligible for tax benefits under Section 80C of the Income Tax Act.

Q2. What is the interest rate of Mahila Samman saving certificate scheme?

Answer: The Mahila Samman saving certificate small savings scheme will offer an interest rate of 7.5%.

Q3. What is the tenure of Mahila Samman saving certificate scheme?

Answer: Mahila Samman Savings Certificate would have a tenure of two years (2023-2025).

Watch This Video on Mahila Samman Savings Scheme

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