The government has doubled the investment limit to ₹ 15 lakh under the Pradhan Mantri Vaya Vandan Yojana (PMVVY) pension scheme – aimed at citizens aged 60 years and above.
The subscription period for the PMVVY pension scheme has also been extended by two years. It was opened for subscription from May 4, 2017 to May 3, 2018. It has now been extended to March 31, 2020, media reports said.
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, reported PTI.
The decision was taken on Wednesday at the Union Cabinet chaired by Prime Minister Narendra Modi, IT and Law Minister Ravi Shankar Prasad was quoted as saying.
He reportedly said the Cabinet has approved increasing the investment limit from ₹ 7.5 lakh to ₹ 15 lakh as well as the extension of subscription period for PMVVY as part of the government’s commitment to financial inclusion and social security.
The move will enable up to ₹ 10,000 pension per month for senior citizens, he added.
As of March, 2018, 2.23 lakh senior citizens had subscribed to PMVVY. In the previous scheme, Varishtha Pension Bima Yojana-2014, 3.11 lakh senior citizens have invested.
The PMVVY is being implemented through Life Insurance Corporation of India (LIC) to provide social security and protect the elderly, 60 years and above, against a future fall in their interest income due to uncertain market conditions, the PTI report highlighted.
The difference between the return generated by LIC and the assured return of 8 per cent annually will be borne by the government of as yearly subsidy, the report said.
