Prime Minister Narendra Modi announced that senior citizens will get a fixed 8 per cent return on 10-year bank deposits of up to Rs. 7.5 lakh.
Senior citizens (60 years and above) will get monthly interest under this scheme.
Currently, banks give senior citizens an additional interest of 0.50 per cent over the regular rates on fixed deposits.
Country’s largest lender SBI offers 7 per cent interest rate to senior citizens on fixed deposits of 5 to 10 years tenure.
Following the spurt in deposits after demonetisation, banks are expected to reduce interest rates which will have a bearing on depositors, especially senior citizens as they mainly depend on interest income.
Under the Senior Citizen Savings Scheme (SCSS) at Post Offices, interest at the rate of 8.5 per cent per annum is given on deposits of up to Rs. 15 lakh with a maturity period of 5 years.