SCSS Rules

Planning for retirement? The Senior Citizen Savings Scheme (SCSS) is a secure way to earn regular income post-retirement. Here’s everything you need to know about SCSS rules, eligibility, benefits, and how it compares with other safe options like Fixed Deposits.
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4 min
04-June-2025

Retirement doesn’t mean your income should stop. With the right planning and investment, you can continue to earn steadily—without worrying about market risks. One such dependable option is the Senior Citizen Savings Scheme (SCSS). Backed by the Government of India, this scheme provides fixed interest income and tax benefits, making it a top choice for senior citizens. However, before investing, it’s important to understand the SCSS rules, eligibility criteria, and features to make an informed decision.

Let’s break it down for you.

What is the Senior Citizen Savings Scheme (SCSS)?

The Senior Citizens' Savings Scheme (SCSS) is a government-backed retirement program for senior citizens in India, allowing them to invest a lump sum either individually or jointly.

Through this scheme, seniors can receive a steady income along with tax benefits. The investment is made via a one-time deposit into the account.

An account holder may open multiple accounts under SCSS, provided the total deposits across all accounts do not exceed Rs. 30 lakh. However, opening more than one account in the same branch within a calendar month is prohibited.

Want similar safety and flexibility with more tenure options? Consider a Bajaj Finance Fixed Deposit with assured returns up to 7.30% p.a. and tenures from 12 to 60 months. Check Eligibility.

Fixed Deposit

  1. Trusted by over 5 lakh customers
  2. Fixed Deposits worth more than Rs. 50,000 crore booked
  3. Rated CRISIL AAA/STABLE and [ICRA]AAA(STABLE)
  4. Up to 0.35% p.a. extra interest offered for senior citizens
  5. Flexible interest payout options available - Monthly, Quarterly, Half-yearly, Annually or at Maturity

By proceeding, you agree to our Terms and Conditions

Key features & benefits of SCSS

Feature

Details

Tenure

5 years (extendable by 3 years)

Interest Rate

8.2% p.a.

Minimum Investment

Rs. 1,000

Maximum Investment

Rs. 30 lakh (total across all accounts)

Tax Benefits

Up to Rs. 1.5 lakh under Section 80C

Withdrawal

Premature closure allowed (with penalty)


Want to lock in your earnings without worrying about market volatility? Bajaj Finance FDs offer fixed returns and zero market dependency, just like SCSS—but with more flexibility. Invest now!

Who is eligible to invest in SCSS?

To open an SCSS account, you must fall under one of the following categories:

  • Senior citizens aged 60 years or above.
  • Retirees between 55 and 60 years under superannuation or VRS, investing within one month of receiving retirement benefits.
  • Retired defence personnel above 50 years and below 60, also investing within a month of retirement benefit payout.

Please note:

  • NRIs and Hindu Undivided Families (HUFs) are not eligible to invest in SCSS.

SCSS rules you should know

Before investing, it’s crucial to understand the rules laid down under SCSS:

  • You can open multiple accounts, but the total investment cannot exceed Rs. 30 lakh.
  • You cannot open more than one account in the same branch in a calendar month.
  • The interest is paid quarterly and credited directly to your bank account.
  • If you prematurely close the account, penalties apply:
    • After 1 year but before 2 years: 1.5% deduction on the deposit.
    • After 2 years: 1% deduction.
  • Extension is allowed once, for 3 more years, after the initial 5-year tenure ends.

If you prefer more liquidity or customisation, try Bajaj Finance FDs with multiple payout options—monthly, quarterly, half-yearly, yearly or at maturity. Start with just Rs. 15,000, Open an FD now!

Fixed deposit variants

Highest Credit Ratings | Trusted with over 1.4 million Deposits | Assured Returns on FD
Recommended

Fixed Deposit - 60 Months

INTEREST RATES UP TO
7.30% p.a.
Invest Online

Fixed Deposit - Senior Citizen

INTEREST RATES UP TO
7.30% p.a.
Invest Online

Fixed Deposit - Age below 60

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - Minor

INTEREST RATES UP TO
6.95% p.a.
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Fixed Deposit - HUF

INTEREST RATES UP TO
6.95% p.a.
Open FD

Fixed Deposit - Sole Proprietor

INTEREST RATES UP TO
6.95% p.a.
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Documents required to open an SCSS account

If you are between 55–60 and retiring under VRS or superannuation, here are the documents you’ll need:

  • 2 passport-size photographs
  • Identity proof (Aadhaar, PAN, Voter ID, Passport)
  • Address proof (Aadhaar, utility bills, etc.)
  • Age proof (PAN card, birth certificate, voter ID, etc.)
  • Employer certificate confirming retirement details
  • Proof of retirement benefit disbursement

All documents should be self-attested. Always carry extra documents related to retirement for smooth processing.

SCSS vs. Fixed Deposit – Which is better for you?

Both SCSS and Fixed Deposits are low-risk, fixed-return instruments—but which one fits your needs better?

Feature

SCSS

Fixed Deposit (FD)

Interest Rate

8.2% p.a. (fixed)

Up to 7.30% p.a. (Bajaj Finance FD)

Lock-in Period

5 years (extendable by 3)

12 to 60 months

Tax Deduction

Section 80C (up to Rs. 1.5L)

Section 80C (Tax-saving FD)

Liquidity

Lower (penalty on exit)

Higher (flexible tenure)

Frequency of Interest

Quarterly

Multiple payout options


Looking for a tax-saving and high-return option? Bajaj Finance Tax-Saving FDs are eligible under Section 80C and come with AAA-rated safety. Open FD.

Tax benefits of SCSS

  • Investments up to Rs. 1.5 lakh qualify for deduction under Section 80C of the Income Tax Act, 1961.
  • However, if the interest earned exceeds Rs. 50,000 in a year, TDS (Tax Deducted at Source) is applicable.

Tip: Submit Form 15H if your total income is below the taxable limit to avoid TDS deduction.

Final Thoughts

The Senior Citizen Savings Scheme is one of the most secure investment avenues for retired individuals in India. With guaranteed income, tax benefits, and a high interest rate of 8.2% p.a., it’s ideal for those looking for steady returns without taking risks. However, if you’re looking for a similar low-risk option with greater flexibility, Bajaj Finance Fixed Deposits can be a strong alternative.

Make your golden years financially independent—with the right mix of stability and returns.

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Frequently asked questions

What is the rule 4 of SCSS scheme?

If a deceased depositor has no nomination, the outstanding amount is credited to the legal heirs upon submission of the FORM-F application, the depositor’s death certificate, and either a succession certificate or a Letter of Administration with an attested copy of the deceased depositor’s probated will, issued under provisions of the Indian Succession Act, 1925.

What is the SCSS closure rule?

After completing the initial five-year tenure, SCSS rules allow you to extend the account for an additional three years. During this extended period, you can close your account prematurely after one year without incurring any penalties.

What is the maximum amount that may be deposited with SCSS?

The maximum deposit allowed in the Senior Citizen Savings Scheme (SCSS) is Rs. 30 lakh. This cap applies to the total deposits across all SCSS accounts held by an individual.

How to open an SCSS account online?

Currently, SCSS accounts cannot be opened online with the post office. However, some authorized banks may allow online SCSS account openings through their internet banking portals or mobile apps.

How many accounts can an SCSS account holder open?

An SCSS account holder can open multiple SCSS accounts, individually or jointly with a spouse. However, the total deposits across all accounts must not exceed Rs. 30 lakh.

What is the rate of interest applicable in SCSS?

The current interest rate for SCSS is 8.2% p.a. and is paid quarterly.

Is a Fixed Deposit better than SCSS for senior citizens?

Both offer fixed returns and safety. However, FDs provide more flexible tenure, multiple payout options, and higher liquidity. Bajaj Finance FDs also offer interest rates up to 7.30% p.a. Check latest FD rates.

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As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

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