The Senior Citizen Saving Scheme (SCSS) is one of the best and safest investments for senior citizens. The Government of India launched it in 2004, which is why it is sometimes called the Senior Citizen Saving Scheme 2004. Its current rules are the Senior Citizens' Savings Scheme, 2019, as amended in 2023. Money invested in the Senior Citizen Saving Scheme (SCSS) qualifies for a tax deduction under Section 80C (section 123 of the Income-tax Act, 2025), up to 1,50,000 rupees, if you use the old tax regime. The scheme matures after five years.
This article covers who can invest, where to open a Senior Citizen Saving Scheme (SCSS) account, the interest rate and other details.
What interest rate does the Senior Citizen Saving Scheme (SCSS) pay?
For the October to December 2026 quarter, the Senior Citizen Saving Scheme (SCSS) pays 8.2% a year, the same rate as since April 2023. The rate is set by the government. It isn't linked to the stock market or any other market return. The government reviews the SCSS interest rate every quarter, but once you open an account, your rate stays the same for all 5 years.
Interest is paid every quarter, on the first working day of April, July, October and January. These are the only payout dates, whenever you opened the account.
Keep in mind that because the interest is paid out every quarter, it doesn't compound.
TDS applies if your SCSS interest is more than 1 lakh rupees in a financial year (the limit for senior citizens since April 2025). TDS is 10% of the interest, or 20% if you haven't given your PAN. For example, Mr. X has invested the maximum 30 lakh rupees in the Senior Citizen Saving Scheme (SCSS) at 8.2% and earns 61,500 rupees of interest a quarter. Over a year that is 61,500 × 4 = 2,46,000 rupees, which is more than 1 lakh rupees. So the TDS is 10% of 2,46,000 rupees, or 24,600 rupees. If Mr. X hasn't given his PAN, the deduction is 20%, or 49,200 rupees. If your total income is below the taxable limit, you can give Form 15H to avoid TDS.
Who can open a Senior Citizen Saving Scheme (SCSS) account?
Any individual aged 60 or above can open a Senior Citizen Saving Scheme (SCSS) account, either alone or jointly with their spouse.
People aged between 55 and 60 who have retired, on superannuation or under a VRS (Voluntary Retirement Scheme) or a Special Voluntary Retirement Scheme (SVRS), can also open a Senior Citizen Saving Scheme (SCSS) account, within three months of receiving their retirement benefits. In that case, the amount can't be more than their retirement benefits.
Retired defence services personnel (but not civilian defence employees) can open an account from the age of 50, if they meet the other conditions.
And who can't open a Senior Citizen Saving Scheme (SCSS) account? Non-resident Indians (NRIs) and Hindu Undivided Families (HUFs).
How much can you invest in the Senior Citizen Saving Scheme (SCSS)?
The minimum is 1000 rupees and the maximum is 30 lakh rupees (raised from 15 lakh in April 2023), in multiples of 1000 rupees.
You can pay by cash or cheque, but for 1 lakh rupees or more you must pay by cheque.
Where can you open a Senior Citizen Saving Scheme (SCSS) account?
You can open a Senior Citizen Saving Scheme (SCSS) account at a post office or an authorised bank. These banks offer Senior Citizen Saving Scheme (SCSS) accounts. Many smaller banks that used to offer it, such as Allahabad Bank, Andhra Bank, Corporation Bank, Dena Bank, Syndicate Bank, Vijaya Bank, United Bank of India and the State Bank associate banks, have since merged into the banks below. Check with your branch before you go.
- State Bank of India
- Bank of Baroda
- Bank of India
- Bank of Maharashtra
- Canara Bank
- Central Bank of India
- Indian Bank
- Indian Overseas Bank
- Punjab National Bank
- UCO Bank
- Union Bank of India
- IDBI Bank
- ICICI Bank Ltd
- HDFC Bank (since March 2025)
You need these documents to open a Senior Citizen Saving Scheme (SCSS) account:
- Proof of age, your Aadhaar (mandatory for all small savings accounts since 2023) and your PAN. Other identity and age proofs, such as a passport, birth certificate, voter ID or senior citizen card, are also accepted for age.
Other things to know about the Senior Citizen Saving Scheme (SCSS)
- You can open more than one Senior Citizen Saving Scheme (SCSS) account, in your own name or jointly with your spouse. But the total across all these accounts must stay within the maximum limit of 30 lakh.
- You can name a nominee when you open the Senior Citizen Saving Scheme (SCSS) account, or add one later.
- You can close the account early at any time, but it costs you. In the first year, the interest already paid to you is taken back from the deposit. If you close it after one year, you lose 1.5% of the deposit. If you close it after 2 years, you lose 1% of the deposit. For example, Mr. X invests 1 lakh in a Senior Citizen Saving Scheme (SCSS) account on 1 November 2026. It matures five years later, on 1 November 2031. If he closes it before 1 November 2027, the interest he has received is recovered, so he gets back 1 lakh minus that interest. If he closes it between 1 November 2027 and 1 November 2028, he loses 1.5% of the deposit, which is 1500 rupees, and gets 98500 rupees. If he closes it between 1 November 2028 and 1 November 2031, he loses 1% of the deposit, which is 1000 rupees, and gets 99000 rupees back.
- At maturity you can extend the account in blocks of three years, as many times as you like. You must apply in the prescribed form within one year of maturity, or of the end of each block. An extended account can be closed any time after one year from the extension with no deduction. Closing it within that first year costs 1% of the deposit.