Government

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02nd October 2022

Positive Attitude Change Everything

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RBI and Bank’s guidelines. Ever, however, users are advised to go through Bank’s Circular and guidelines for details
 Contents

PUBLIC PROVIDENT FUND SCHEME, 2019 .................................................................... 1

RBI FLOATING RATE SAVINGS BONDS, 2020 ((TAXABLE)........................................ 3

SENIOR CITIZENS SAVINGS SCHEME – 2019 (SCSS) ................................................... 4

SUKANYA SAMRIDDHI ACCOUNT (SSA) ........................................................................ 5

KISAN VIKAS PATRA (KVP) ................................................................................................ 7

ATAL PENSION YOJANA (APY).......................................................................................... 8

NATIONAL PENSION SYSTEM (NPS) ................................................................................ 9

PUBLIC PROVIDENT FUND SCHEME, 2019

Erstwhile PPF Scheme 1968 now replaced with PPF Scheme 2019

Eligibility for 1. The scheme is open to Individuals and account can also be opened on behalf of
opening minor child as a natural / legal guardian.
Account 2. Only one account can be opened in one name. If two accounts in same name are
opened by mistake, second account shall be treated as irregular and will not
carry any interest amount.
3. If a resident, who opened an account under this scheme, subsequently becomes
a non-resident during the currency of the maturity period, the account shall be
deemed to be closed with effect from the day he becomes a non-resident.

Subscription Minimum amount Rs.500/- and maximum Rs.1,50,000/- in a financial year.

Period Minimum period is 15 years and can be extended in a block of 5 years.
Rate of As per Govt. Notification from time to time (on Quarterly basis)

Interest Presently 7.10% w.e.f 01.07.2021

Withdrawal • Partial withdrawals are allowed anytime after the expiry of 5 years from the end of
from the Fund the year in which initial subscription was made. In case of medical emergency /
serious ailment / critical illness or higher education of minor child, change of
residency status, account can be closed after 5 years (Valid documents / Proof to
be submitted)
• Partial withdrawals are allowed after the expiry of 5 financial years.
• Partial withdrawal is restricted to 50 % of the amount at credit at the end of 4th year
immediately preceding the year in which the withdrawal is made.
• Entire amount can be withdrawn after completion of 15 years.
Loans Anytime after the expiry of one year from the end of year in which initial subscription
was made but before the expiry of 5 years from the end of the year in which initial
subscription was made, a loan of 25% of the credit balance at the end of the second
year immediately preceding the year in which the loan is applied may be availed of by
the subscriber

In erstwhile scheme, one needs to pay an interest of 2% on such loans up to & above
the prevailing PPF interest rate, which is now reduced to 1 percent.
Nominations Nominations of one or more persons are allowed except in the account opened on behalf
of the minors.

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Premature Partial withdrawals are allowed anytime after the expiry of 5 years from the end of the
Withdrawal year in which initial subscription was made. In case of medical emergency / serious
ailment / critical illness or higher education of minor child, change of residency status,
account can be closed after 5 years (Valid documents / Proof to be submitted)
Tax 1. Deposits in the account are exempted under section 80C of Income Tax Act
Concessions 2. Interest on PPF / withdrawal from the fund is exempted from Income tax.
3. Balance held in PPF account is totally exempt from wealth tax.
4. Deposits in the name of wife/minor children will also qualify for deduction of
section 88 of Income Tax Act, 1961.
PPF accounts can be opened at any of the authorized branches
Premature 1. Exemptions:
Closure a) In case of need of Funds for higher education of dependent children, after
producing the supporting document.
b) Treatment of life-threatening ailments affecting self, spouse or dependent
Children or parents.
c) On account of change in residency status on production of a copy of passport &
visa or I-T return, premature closure is allowed.

2. If a PPF account that has already completed 15 years and has subsequently been
extended for 5 years. If PPF is closed prematurely before the completion of the current
5 year block period, the reduction in interest rate by 1 percent point shall be applicable
from the date of the commencement of the current 5 year block period and not from
the date of initial opening of the account.

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RBI FLOATING RATE SAVINGS BONDS, 2020 (TAXABLE)
ITEM FRSB, 2020 (TAXABLE) REMARKS
Category of Non-Resident Indians (NRIs)
Investor Resident Individual, HUF are not eligible to invest in
these bonds.
Limit of
investment Minimum Rs.1000/- and in multiples thereof. No maximum limit

Date of Issue of Date of receipt of subscription in cash (up to

bonds Rs.20,000/- only) or date of realization of ---
cheque /draft/ funds.
Forms of Bonds Bond Ledger Account will be
Electronic form held in the Bond Ledger
opened by the Receiving Office
Account.
in the name of investor/s.
Rate of Interest (i) Interest is payable semi-annually from the
date of issue of bonds, up to 30th June / 31st
December as the case may be, and
The interest rate is
thereafter half-yearly for period ending 30th
linked/pegged with prevailing
June and 31st December on 1st July and 1st
National Saving Certificate
January respectively.
(NSC) rate with a spread of (+)
35 bps over the respective NSC
(ii) Half-yearly interest is payable on 1st January
rate.
/ 1st July. The coupon on 1st January 2021
shall be paid at 7.15%.

Post Maturity Interest will not be paid after maturity period

Interest ---
of the bond.
Tax benefits Tax will be deducted at source
while interest is paid. Any
Income from the bonds is taxable. other applicable exemption
may be declared in the
Application Form.
Nomination The sole holder or all the joint holders may
Facility ---
nominate one or more persons as nominee**
Maturity period 7 years from the date of issuance. ---
Premature
Facility is available to the eligible investors
redemption 50% of interest due and
after lock in period of 4, 5, and 6 years in the
payable for the last six months
age bracket of 80 years and above, between 70
shall be recovered as penalty.
to 80 years and 60 to 70 years respectively.
Transferability The bonds are non transferable. Transferability is limited to
nominee(s)/legal heir in case
of death of holder.
Tradability /
Advances The bonds are non tradable in the secondary
market and also not eligible as collateral for ---
availing loans.
Application Unauthorized branches can
forms Available at 66 authorized branches of Union mobilize applications and can
Bank of India send to nearby authorized
branches.

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SENIOR CITIZENS SAVINGS SCHEME – 2019 (SCSS)

Scheme As per Government of India’s notification dated 12.12.2019, this scheme

is called as Senior Citizens’ Savings Scheme, 2019.

Eligibility ➢ Individual who has attained the age of 60 years or above as on the
date of opening of the account.
➢ Individual, who have attained the age of 55 years or more but less
than 60 years on the date of opening of an Account, subjected to
retirement under VRS or superannuation scheme shall also be eligible
to subscribe under the scheme but within a period of one month.
➢ Retired personnel of Defence Services (excluding Civilian Defence
Employees) on attaining the age of 50 years.
➢ Non-Resident Indians (NRIs) and Hindu Undivided Family (HUF) are not
eligible to open account under these rules

Tenure of the Scheme 5 years, which can be extended by 3 more years just once.
Rate of Interest 7.60% w.e.f 01.10.2022, however, subject to change as per Govt.
Notification from time to time.
Frequency of Computing Quarterly
Interest
Tax Aspects Interest is fully taxable
Investment to be in Minimum Rs. 1000/- in beginning and thereafter in multiples of Rs.1000/-
multiples of
Maximum Investment Limit Rs. 15 lakhs
Eligibility Resident Individual can invest in SCSS. NRIs and HUFs are not allowed
to invest in SCSS
Facility of premature Available after 1 year of holding but with penalty.
withdrawals - 1.5% of Deposit amount, before completion of 2 Years from the date
of Account opening.
- 1% of Deposit amount, between 2 Years to less than 5 Years.
Transferability feature Accounts can be transferred to other branches/banks/post office.
Tradability Not available
Nomination Facility Available
Mode of Holding Generally single. Joint mode is permitted but only spouse will be allowed
to open accounts jointly with beneficiaries.

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SUKANYA SAMRIDDHI ACCOUNT (SSA)

The Scheme A Govt. of India Deposit Scheme for Individuals on behalf of Minor Girl Child

The account may be opened by or legal guardian in the name of a girl child
from the birth of the girl child till she attains the age of ten years and any
girl child, who had attained the age of ten years, one year prior to the
commencement of these rules, shall also be eligible for opening of the
Eligibility
account under these rules.
Natural or legal guardian of a girl child shall be allowed to open the account
for two girl children only or 3 accounts if twin girls are born in the second
birth or triplets are born in the first birth.
Initial Minimum Deposit : Rs 1000.00
Monetary Limits Further Deposits to be made in multiples of Rs 100.00 into the account with
Minimum deposits in the account in financial year: Rs 1000.00
Birth Certificate of Girl child; Address proof of parents/guardians; Identity
Documents
proof of the parents/guardian
Minimum tenure of contribution is 15 years from the date of opening of
Subscription Limits
account.
21 years from the date of opening of account.
Duration Withdrawal allowed up to 50% for the girl’s higher education and marriage
after she attains 18 years of age
7.60 % w.e.f. 01.07.2021 (Interest is compounded annually), however,
Rate of Interest
subject to change as per Govt. Notification from time to time.
➢ Annual subscription during F.Y. eligible for tax exemption under Sec 80
C of I.T. Act.
Tax Benefits ➢ Interest earned on the deposit amount under the scheme is tax free u/s
10 of IT Act.
➢ No tax will be levied on the maturity amount.
➢ In the event of death of the Beneficiary Account holder the account shall
be closed immediately.
➢ If, after opening of the account, the account holder becomes non-citizen
or non-resident of India, intimation to this effect shall be given by the
Premature Closure
guardian or the Account Holder within a period of one month from the date
of such status. In the event of such change, no interest shall be deemed
to accrue to the account holder and the Account shall deemed to be closed
prematurely from that date.

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 ➢ In case of extreme compassionate grounds such as medical support in life
threatening diseases of the Account holder or death of the guardian, that
the operation of continuation of the Account is causing undue hardship to
the Account holder, premature closed may be allowed after recording
reasons in writing.
Mode of Deposit Cash/Cheque/ Demand Draft

50% of the balance lying in the account as at the end of previous financial
Withdrawal: year for the purpose of higher education, marriage after attaining the age of
18 years.

Completion of 21 years from the date of opening of the account & where the
Marriage of the account holder takes place before completion of such period
Closure on Maturity
of 21 years. (Affidavit verifying Account Holder’s 18 years of age as on date
of closing of account)

Operations All branches can open Sukanya Samriddhi accounts

Penalty in Irregular An account may be regularized on payment of a penalty of Rs. 50/- per year,
Account along with the minimum specified subscription for the year (s) of default.

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KISAN VIKAS PATRA (KVP)
It is Small Saving Certificate Scheme. Its enables people to mobilize their
Scheme
small savings into long term saving plan.

One must be adult and Indian Resident.

Eligibility Joint accounts permitted up to 3 individuals.

Trust, HUF (Hindu Undivided family) and NRI not eligible to invest in KVP

A minimum of one thousand rupee and any sum in multiple of one hundred
rupees may be deposited in an account.
Investment Limit
No maximum limit for purchase of the certificates.

Interest, Maturity Invested amount doubles on Maturity.

Amount and Rate of interest and maturity period as notified by the Government of India
Period on quarterly basis.

Interest Rate Current Interest Rate is 7.00% (w.e.f. 01.10.2022). Will mature in 123 months

No income tax benefit is available under the scheme. However, the deposits
Tax Benefits
are exempt from Tax Deduction at Source (TDS) at the time of withdrawal.

Operations Account opening & operations through GBM module

Lock in period for premature withdrawal is 2 years 6 months. However, it

can also be paid earlier in following cases:
Premature
Withdrawal • Death of certificate holder or any of the holders
• On order by court of law
• Forfeiture by a pledge or by Gazette Government Officer.
•

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ATAL PENSION YOJANA (APY)
Atal Pension Yojana (APY) is one of the Social Security Schemes for launched by
Scheme
GOI in May 2015 for citizens of India in unorganized sector.

All Citizen of India aged between 18-40 years.

NRI in the age group 18-40 years of age having a Bank Account with APY POP
Eligibility (Point of Presence) i.e. Branch are also eligible to open APY Account. If the NRI
becomes non-citizen of India, then the APY Account will be closed and the net
actual interest earned on his/her contributions (after deducting the account
maintenance charges) will be refunded.

Subscription Defined contribution by subscriber depending upon his age & targeted pension
Limits Minimum Rs 42/- p.m. for subscriber of 18 years of age (Chart given below).

Investment Contributions till the subscriber attain 60 years of age. Minimum tenure of
Period contribution is 20 years from the date of opening of account.

The exit from the Scheme is permitted at the completed age of 60 years with
Duration/ Exit 100% annuity of pension wealth. On exit, pension available to the subscriber. Exit
also permitted in the event of death of beneficiary or terminal disease.

Nomination It is mandatory to provide nominee details in APY Account.

Guarantee Each subscriber under APY shall receive a GOI Guaranteed minimum pension of
Monthly Rs1000/-to Rs. 5000/- after the age of 60 years until death. After the demise of
Pension the Subscriber, the spouse of the subscriber shall be entitled to receive the same
Amount pension amount as that of the subscriber.

After the demise of both the subscriber and the spouse, the nominee of the
Pension Corpus subscriber shall be entitled to received the pension wealth, as accumulated till
the age of 60 years of the subscriber.

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NATIONAL PENSION SYSTEM (NPS)
NPS is a voluntary, defined contribution retirement savings scheme designed to enable the
subscribers to make optimum decisions regarding their future through systematic savings
during their working life. NPS seeks to inculcate the habit of saving for retirement amongst
the citizens. It is an attempt towards finding a sustainable solution to the problem of
providing adequate retirement income to every citizen of India. It is operated with the
participation of the Central Recordkeeping Agency (CRA) which is the National Security
Depository Ltd. (NSDL).

• This scheme has been introduced by Pension Fund Regulatory and Development Authority
(PFRDA) to promote old age income security to all citizens of India including workers of
the unorganized sector.

• NPS is a voluntary, defined contributions retirement savings scheme & is administered /

regulated by PFRDA. It is operated with the participation of Central Record Keeping
Agency (CRA) – NSDL e-Governance Infrastructure Limited & KFin Technologies Private
Limited.

• A Citizen of India, OCI, whether resident or non- Resident Indian between age group of
18 to 70 years; salaried or self-employed can join this scheme.

• The people within age group 60-70 can also join/re-join NPS.

• Account can be opened by Individual and Corporate.

• Every individual subscriber will be issued a Permanent Retirement Account

Number (PRAN) card having 12 digit unique numbers.

• Under NPS account, two sub-accounts – Tier I & II are provided. Tier I account is
mandatory and the subscriber has option to opt for Tier II account opening and
operation. Tier II account can be opened only when Tier I account exists.

The subscribers joining the NPS after the age of 60 would be eligible to continue in system up to
age of 70 years and during this period the subscriber may continue to contribute. Two types of
accounts can be opened under NPS. They are:

• Tier-I account: A retirement and pension account which can be withdrawn only upon
meeting the exit conditions prescribed under NPS. The applicant shall contribute his/her
savings for retirement into this account. This is the retirement account and applicant
can claim tax benefits against the contributions made subject to the Income Tax rules
in force. Initial amount while opening NPS account is Rs. 500/- with Minimum Yearly
Contribution is Rs. 1000/-. There is no upper limit for the maximum contribution.

• Tier-II account: This is a voluntary investment facility. The applicants are free to
withdraw his/her savings from this account whenever he/she wishes. This is not a
retirement account and applicant can’t claim any tax benefits against contributions to
this account. Minimum amount per contribution is Rs 250/- & no upper limit for the
maximum contribution.

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 Funds will be invested in 4 different classes:

Equity, Government Securities, Corporate Debts & Alternate Investment Fund (A). The
investor has 2 Investment options for managing the fund: Auto and Active.

• Active Choice: - Under this option, subscribers are free to allocate the investment across
the asset class provided E/C/G/A. Subscriber decides allocation pattern amongst E, C, G
and A as mentioned below.

Asset Class Cap on Investment

Equity (E) 75% (Upto age 50)
Corporate Bonds (C) 100%
Government Securities (G) 100%
Alternate Investment Fund (A) 5%

• Auto choice – This is the default option under NPS and wherein the management of
investment of fund is done automatically based on the age profile of the subscriber.

Age (In Years) Asset Class (E) Asset Class (C) Asset Class (G)
Upto 35 50% 30% 20%
36 48% 29% 23%
37 46% 28% 26%
55 and Above 10% 10% 80%

Type of Auto Life Cycle Fund LC50/ LC25/ LC 75:

• LC 75- It is the Life Cycle fund where the Cap to Equity investments is 75% of the total
asset (Aggressive)
• LC 25- It is the Life Cycle fund where the Cap to Equity investments is 25% of the total
asset (Conservative)
• LC 50- It is the Life Cycle fund where the Cap to Equity investments is 50% of the total
asset (Normal/ Moderate)

Pre-Mature Closure / Maturity / Partial Withdrawal:

Exit & Withdrawal:

The withdrawal treatment is different based on the criteria that if the Subscriber
registration is before 60 years and after 60 years.

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 For Subscriber registration before 60 years:

1. Pre-Mature Closure:
2.
• The subscriber has to compulsorily annuitize 80% of the accumulated pension wealth and
the remaining 20% can be withdrawn as lump sum.
• If Corpus <2.50 Lakhs, complete withdrawal permitted.
• In case of death of the subscriber - Entire accumulated pension fund will be paid to the
nominee/s or legal heirs, as per norms. No family pension under the scheme.

1. On Maturity:

• After attaining 60 years of age, upto 60% of the corpus can be withdrawn. Subscriber is
required to invest minimum 40% of the accumulated savings (Pension Wealth) to be kept
as annuity. At the time of maturity whole 60 % of corpus amount is tax exempted.
• If Corpus < 5.00 Lakhs, complete withdrawal permitted.
•

• For Subscriber registration after 60 years: At the time of withdrawal, if the Subscriber
exits after completing 3 years of holding NPS account 60-40 option is available (40% annuity
is minimum condition, if the subscriber wants more pension he can allocate higher annuity
percentage). If the Subscriber exits his NPS account before completing 3 years then 20%
lumpsum & 80% has to be allocated for annuity option is available.
•
• Can defer the withdrawal of eligible lump sum amount till the age of 75 years and withdraw
the same in 10 annual instalments.
•
• Annuity purchase can also be deferred for maximum period of 3 years at the time of exit.
• For the subscriber under Unorganized Sector (UOS), if the exit option or deferment option
or continuation is not exercised then by default the subscriber is taken into continuation
mode. This is applicable only for UOS sector subscriber. For corporate sector subscriber,
the subscriber has to give the concerned request (continuation/deferment/exit) 15 days
prior to his retirement date. After the subscriber’s retirement date, if he/she wishes to
continue or defer a written application has to be sent to NPS Trust for necessary action.

Partial Withdrawal:

• Subscriber should be in NPS for at-least 3 years.

• Amount should not exceed 25% of the contributions made by the subscriber during that
period.
•

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•
• Purpose for which partial withdrawal allowed are:
• Higher education of children
• Marriage of children
• Purchase or construction of residential house or flat
• Treatment of specified illness
• Disability of more than 75%
• Skill Development/ re-skilling or any other self –development activities
• Establishment of own venture or any start-ups Other reasons as specified from time
to time by PFRDA.

• Frequency of partial withdrawal:

• Max 3 (three) times during entire tenure
• The gap between the consecutive partial withdrawals has been removed.

Method of
Service Charges
deduction
Initial Subscriber
Rs. 200/- + GST
Registration
0.25% of the contribution ; Min Rs 20/- & To be collected
All Contribution
Max Rs 25000/- + GST upfront
All Non-Financial
Rs 20/- + GST
Transaction
Through
Rs. 50/- per Annum (only for NPS-All
Persistency cancellation of
Citizen )
units

Tax Benefits to the Employees & Employer :

1. Benefits to Employer:
• A contribution made by the employer (Upto 10% of Basic + DA) is allowed as Business
expense under Sec 36 (1) iv (a) of I.T Act 1961.

2. Benefits to Employee:

• Employee’s own contribution is eligible for tax deduction upto 10% of Salary (Basic + DA)
under Sec 80 CCD(1) within the overall ceiling of Rs. 1.50 lakhs under Sec 80 CCE of the
I.T Act
• Employee also gets tax deduction for the contribution made by the employer under section
80 CCD (2) of I.T Act upto 10% of salary (Basic + DA) which is in addition to the tax benefit
available under sec 80 CCE. No monetary ceiling.

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 Note:- Subscriber is allowed tax deduction in addition to the deduction allowed under
Sec 80 CCD(1) for additional contribution in his NPS account subject to maximum
investment of Rs. 50000/- under sec 80 CCD 1 (B).

Process of NPS account opening:

NPS PRAN library is implemented for instant PRAN generation through “NPSPRAN” menu
in Finacle for NPS account opening and “NPSCOLL” for subsequent contribution and service
related request. Our Mumbai Samachar Marg branch acts as the Point-of- Presence (PoP)
for the scheme. All concerned are requested to take note of the same and ensure
compliance in NPS account opening;

• Branches to collect NPS account opening applications from customers and check the
application as well as KYC documents as per guidelines of NPS.
• Subscriber Registration through NPSPRAN menu in Finacle.
• On subscriber registration in Finacle, system will generate receipt number & PRAN
automatically.
• Subscriber registration process is of maker-checker concept, wherein one user will feed
the details which shall be verified by another user.
• After verification of subscriber registration, branches will be able to make the transaction.
• After posting of transaction, branch will be able to generate the covering letter which
contains PRAN details and receipt numbers.
• Branches have to send application form along with covering letter to application collection
Nodal Office, Mumbai (Union Bank of India Government Business Division, Ground Floor,
Mercantile House, 708, Magazine Street, Reay Road, Mumbai, Maharashtra-400010).
• Branches are advised to keep a copy of form for records.
• PRAN card will be issued to subscriber by post / courier by NSDL ltd after successful
submission of application forms.
• Generated PRAN will be activated in T+2 Days.
• Branch to ascertain that photo and signatures are in place, and should be in prescribed
format, signatures across the form & photo should be avoided.

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 IMPORTANT CIRCULARS

Sl No Circular No Date Subject

1 GBD Circular Letter 12917 Jul 27, 2017 PPF Accounts-Premature Closure
Clarifications
2 GBD Circular Letter 11417 Jan 4, 2017 PPF-Online Account Opening through
Internet Banking and Pre-mature closure
3 GBD Circular Letter 20621 Jul 03, 2021 Revision in ROI on Floating Rate Savings
Bond, 2020 (Taxable) – FRSB 2020(T)
4 GBD Circular Letter 11718 Feb 03, 2017 Guidelines on Senior Citizens Savings
Scheme (SCSS)
5 GBD Circular Letter 10716 Aug 25, 2016 Sukanya Samriddhi Accounts Rules, 2016
6 Instruction Circulars 18420- Aug 07, 2020 Floating Rate Savings Bond, 2020(Taxable)
2020 FRSB 2020(T)
7 GBD Circular Letter 13017 Sep 07, 2017 Issuance of KVP Certificate (Kisan Vikas
Patra)
8 IC No 03475-2022 Aug 02, 2022 Standard Operating Procedure (SOP) for
operational guidelines to branches on Atal
Pension Yojana Scheme
9 IC No 79-2015 May 18, 2015 “Atal Pension Yojana” APY by Govt of India
(GoI)
10 GBD Circular Letter 16018 Nov 26, 2018 NPS account opening and procedure.

11 GBD Circular Letter 11417 Feb 01, 2017 Revised guidelines on National Pensions
System (NPS)

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