Mahila Samman Saving Certificate facility now available in these public sector banks, four private banks. Check details here

Mahila Samman Saving Certificate (MSSC) 2023 accounts, the newest small savings scheme, can now be opened in 12 public sector banks and four private sector banks. The scheme was announced in the Union Budget this year, and was only available through post offices.  

According to a recent notification by the Finance Ministry, one can apply for a Mahila Samman Savings Certificate, 2023, in all public sector banks and ICICI Bank, Axis Bank, HDFC Bank Ltd and IDBI Bank. 

“The Central Government hereby specifies that all public sector banks and ICICI Bank, Axis Bank, HDFC Bank Ltd and IDBI Bank shall be authorised to operate the Scheme namely, Mahila Samman Savings Certificate, 2023 with effect from the date of publication of this notification in the Official Gazette.” 

The notification further said the authorisation to operate the scheme is subject to a few conditions, like the banks should have dedicated software for operation and accounting of National Savings Schemes with specific functionality for each scheme.  

Banks have also been asked to manage and offer the scheme through online mode also in all branches. 

All remittances shall be credited to the Government Account at the RBI, Central Accounts Section, Nagpur, within one day in the case of Core Banking Solution branches, and three days in the case of non-Core Banking Solution branches. 

“In case of a delay in remittances beyond the period, as mentioned, the bank shall pay a penalty equal to the rate of interest payable to the depositor plus 0.5 per cent in case of delays up to 30 days, and 1 per cent in case of delays beyond 30 days,” the notification said.  

It further added that the bank shall report various transactions under proper codes to the Reserve Bank of India, and the Ministry of Finance may levy a penalty in case of the bank’s failure on this count. 

Besides this, the banks will be required to declare in advance the list of branches that shall not operate any of the National Savings Schemes.  

Every bank will be required to submit a periodic report or any other requisite information from time to time to the Central Government concerning the deposits of subscription and withdrawals under the said Scheme, the notification said. 

Mahila Samman Saving Certificate 

The Centre had introduced the Mahila Samman Savings Certificate, a one-time savings scheme for women, in the Budget 2023 to encourage more women to invest. The scheme was announced during the Budget 2023 to commemorate ‘Azadi ka Amrit Mahotsav’. 

Scheme details 

The two-year tenure scheme offers an attractive and fixed interest of 7.5 per cent interest. The scheme has flexible investment and partial withdrawal options with a maximum limit of Rs 2 lakh.  

Interest rates  

The Centre is offering an interest of 7.5 per cent a year. The interest will be compounded quarterly and will be credited to the account.  

Eligibility  

The Centre has specified that an application for opening an account under the MSSC scheme can be made by a woman for herself or by the guardian on behalf of a minor girl.  

Documents needed

Investors can visit the nearest post office or designated banks with a copy of their PAN cards, Aadhaar cards, a cheque for the deposit amount, and invest in the scheme.

Investment limits  

The minimum investment amount is Rs 1,000, and the maximum amount is Rs 2 lakh per financial year. Additionally, the scheme allows premature withdrawal after one year with some nominal penalty charges.  

Investment gap 

Besides, the government has specified that an individual can open any number of accounts subject to the maximum limit for deposit of Rs 2 lakh and a time gap of three months between the existing account and the opening of another account. 

Maturity date  

The deposit matures after two years from the deposit date.  

Partial withdrawal  

All account holders can withdraw a maximum of up to 40 per cent of the eligible balance only once after one year from the date of opening of the account.   

If the account is for a minor girl, the guardian can apply for the withdrawal by submitting a specific form to the accounts office. 

Tax deduction  

Earlier, the government has already clarified that tax deducted at source will not apply on interest earned on Mahila Samman Savings Certificate, but the interest income will be added to the total income for tax calculation. 

A Finance Ministry notification stated the MSSC will be a scheme under “sub-clause (c) of clause (i) of sub-section (3) of section 194A of the Income-tax Act, 1961”. Section 194A deals with provisions relating to Tax deducted at Source (TDS) on interest other than interest on securities. Tax is to be deducted under Section 194A if interest (other than interest on securities) is paid to a resident. 

However, this will not be applicable, as prescribed on interest amounting to Rs 40,000 on any post-office deposit under any scheme framed and notified by the Centre. The exemption limit for senior citizens is Rs 50,000. 

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