Bank of India on Tuesday rolled out the Mahila Samman Savings Certificate, 2023 scheme. This is the first bank to operationalise this scheme at all its branches, enabling them to open accounts under the Mahila Samman Savings Certificate, 2023, said Rajneesh Karnatak, Bank of India's CEO and Managing Director.
Under the scheme, individual girls or women can open a Mahila Samman Savings Certificate. A guardian can also open an account on behalf of a female minor.
Deposits made under this scheme will fetch an attractive interest rate of 7.5% per annum and that will be compounded quarterly and credited to the account.
All earnings under the Mahila Samman Savings Certificate will be taxable as per existing income tax provisions.
A finance ministry notification in May had stated that tax deducted at source (TDS) 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.
And it is vital to mention here that Department of Economic Affairs of the Ministry of Finance, through an e-gazette notification, on June 27 permitted all public sector banks and eligible private sector banks to implement and operationalise the Mahila Samman Savings Certificate 2023.
It is only after this notification that the scheme could be made available for subscription in post offices and eligible scheduled banks.
The Union Finance Minister Nirmala Sitharaman announced this flagship scheme during the Budget speech FY 2023-2024 on February 1, 2023. The scheme has been in operation through the Department of Post since April 1, 2023.
Key features of the scheme
1. This gives an attractive and secure investment option to all girls and women.
2. The account can be opened on or before Mar 31, 2025 for a tenure of two years.
3. The deposit made under this scheme will bear interest at the rate of 7.5 percent per annum which will be compounded quarterly. The effective interest rate will therefore be 7.7 percent.
4. A minimum of ₹1,000 and any sum in multiple of 100 may be deposited within the maximum limit of ₹2 lakh.
5. Maturity of the investment under this scheme is two years from the date of opening of account.
6. The account holder is eligible to withdraw maximum up to 40 percent of the eligible balance in the scheme account.