Published Date - 03 May 2018 05:20:07 Updated Date - 03 May 2018 05:22:15

Cabinet approves Doubling of Investment Limit for Senior Citizens – Pradhan Mantri Vaya Vandana Yojana (PMVVY)

The Union Cabinet on Wednesday approved doubling of investment limit for senior citizens from Rs 7.5 lakh to Rs 15 lakh under Pradhan Mantri Vaya Vandana Yojana (PMVVY). The move will guarantee a maximum pension of Rs 10,000 a month under the Pradhan Mantri Vaya Vandana Yojana, according to a government press release. The Cabinet also extended the time limit for subscription to March 31, 2020 from May 4, 2018. The PMVVY is being implemented through Life Insurance Corporation of India (LIC) to provide social security during old age and protect elderly persons aged 60 years and above against a future fall in their interest income due to uncertain market conditions.

This is a major step of central govt. towards financial inclusion and social security of senior citizens. Previously, the maximum investment limit was Rs. 7.5 lakh which enables a person above 60 years of age to get Rs. 5000 as monthly pension. Life Insurance Corporation (LIC) of India implements PMVVY 2018 Scheme.

Now the enhanced coverage will boost this social security initiative – modified PMVVY and ensure a larger security cover to Senior Citizens. Candidates can purchase this scheme both through offline and online modes. For online mode, visit the website www.licindia.in

PMVVY 2018 – Investment Limit for Senior Citizens Doubled

The important features and highlights of CCEA decision of extending investment and time limit under Pradhan Mantri Vaya Vandana Yojana 2018 scheme are as follows:-

  • To boost social security for senior citizens, central govt. has doubled the investment limit from Rs. 7.5 lakh to Rs. 15 lakh under PMVVY 2018.
  • Accordingly, this larger social security cover will enable the senior citizens to avail up to Rs. 10,000 as monthly pension (previously Rs. 5,000).
  • Till March 2018, there are total 2.23 lakh beneficiaries (senior citizens) under PMVVY 2018. The previous Varishtha Pension Bima Yojana 2014 scheme has total 3.11 lakh beneficiaries / senior citizens.
 

LIC of India implements this scheme to provide security cover to the senior citizens and to protect the elder ones.

Pradhan Mantri Vaya Vandana Yojana 2018

PMVVY 2018 is a senior citizen welfare scheme to protect the citizens above 60 years of age against a future fall in their interest income due to uncertain market conditions. This scheme provides an assured guaranteed return of 8% per annum for 10 years. In this modified PMVVY Scheme, senior citizens can also opt for pension on monthly / quarterly / half-yearly and yearly basis. Candidates can see the policy document of Pradhan Mantri Vaya Vandana Yojana 2018 – Policy Document (PDF)

The difference in returns as provided by LIC and the assured return of 8% per annum is borne by the central government. Central govt. provides this differentiated amount as subsidy on an annual basis. For more details on the Pradhan Mantri Vaya Vandana Yojana, click the link – PMVVY 2018.

1) The PMVVY scheme has been implemented through Life Insurance Corporation of India (LIC). to provide social security during old age and protect elderly persons aged 60 years and above against a future fall in their interest income due to uncertain market conditions.

2) The scheme provides an assured pension based on a guaranteed rate of return of 8 per cent per annum for ten years, with an option to opt for pension on a monthly, quarterly, half-yearly or annual basis.

3) The differential return, the difference between the return generated by LIC from the scheme and the assured return of 8 per cent per annum, is borne by the government as subsidy on an annual basis.

4) As of March 2018, a total number of 2.23 lakh senior citizens were getting regular pension under the Pradhan Mantri Vaya Vandan Yojana (PMVVY).

5) PMVVY can be purchased offline as well as online through Life Insurance Corporation (LIC) of India.

6) At the end of the policy term of 10 years, the pensioner gets back the purchase price (amount invested to earn pension) along with final pension instalment.

7) On death of the pensioner during the policy term of 10 years, the purchase price will be paid to the beneficiary.

8) Currently, a loan up to 75 per cent of purchase price (amount invested to earn pension) is allowed after three policy years to meet the liquidity needs.

9) The PMVVY scheme also allows for premature exit for treatment of any critical/terminal illness of self or spouse.

10) On such premature exit, 98 per cent of the purchase price will be refunded.

 


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