Mumbai: Finance minister Arun Jaitley on Friday launched Pradhan Mantri Vaya Vandana Yojana, a pension scheme for senior citizens above 60 years of age. The scheme gives a guaranteed annual return of 8% over a policy tenure of 10 years.
Life Insurance Corporation of India (LIC) has the sole rights to sell this scheme both online and offline.
According to Jaitley, the scheme will be favourable for senior citizens because of its non-fluctuating rate of interest. It is also exempted from any form of service tax.
One can enroll under this scheme from 4 May 2017 to 3 May 2018.In a soft launch, 58,152 policies have been sold since 4 May so far, while Rs2,705 crore was collected.
Minimum and maximum purchase prices for the pension scheme are Rs150,000 and Rs750,000 respectively. If a senior citizen is in a liquidity crunch, loans up to 75% of the purchase price after three policy years can be availed. The interest payments will be adjusted against pension instalments while the loan amount will be recovered form claim proceeds.
First Published: Fri, Jul 21 2017. 09 41 PM IST