PMVVY is a pension scheme exclusively for the senior citizens aged 60 years and above launched by the Government of India. It was announced on 4th May, 2017 and available till 31st March, 2020. This scheme offers a guaranteed payout of pension at a specific rate for 10 years.
A death benefit in the form of return of purchase price to the nominee is also applicable. This policy was first opened for a short period of time but later extended. It provides various benefits which are mentioned below.
Table of Contents
Benefits of PMVVY Scheme
- Assured return of 8% p.a. payable provided monthly for 10 years.
- This scheme is exempted from Service Tax/ GST.
- Purchase price along with the final pension installment shall be payable on the successful survival of the pensioner to the end of policy term 10 years.
- Up to 75% loan of Purchase Price will be allowed after 3 years of policy.
- For any critical and severe illness of self and spouse this scheme also implies premature exit. In such case 98% of the purchase policy amount shall be refunded.
- The Purchase Price will be paid to the recipient if the pensioner died during the policy time of 10 years.
Minimum age requirement for the entry in this scheme is 60 years. There is no limit in the maximum age limit. The maximum investment limit is Rs.15 lakh per senior citizen.
Total amount of pension under all the policies allowed to a family in this scheme shall not exceed the maximum pension limit.
How to apply for PMVVY
Life Insurance Limited (LIC) of India has been given the entitlement for the operation of this scheme. You can apply in both Online and Offline mode. For the Online mode follow the below link
- PAN Card
- Address proof by Aadhaar, Passport
- First page of bank passbook of the account in which you intend the pension to be credited in.
Purchase Price Information
This scheme is purchasable by payment of a lump sum Purchase Price. Pensioner has the option to choose frequency from monthly, quarterly, half-yearly and yearly for the pension payout. Below is the list for minimum and maximum Purchase Price under different modes of pension.
|Mode of Pension||Minimum Purchase Price||Maximum Purchase Price|
|Yearly||Rs. 1,44,578/-||Rs. 7,22,892/-|
|Half-yearly||Rs. 1,47,601/-||Rs. 7,38,007/-|
|Quarterly||Rs. 1,49,068/-||Rs. 7,45,342/-|
|Monthly||Rs. 1,50,000/-||Rs. 7,50,000/-|
The pension payment should be paid through NEFT or Aadhaar Enabled Payment System. The first installment will be paid according to the mode you have chosen. Time as 1 year, 6 months, 3 months and 1 month will be yearly, half-yearly, quarterly or monthly respectively.
Also you can avail Loan facility after the successful completion of 3 policy years. The maximum loan amount should not surpass the 75% of the Purchase Price.
The deposits done in the scheme are exempted from income tax under section 80C of Income Tax Act, 1961. Provisions of Tax deduction at Source (TDS) are applicable to the scheme. Keep in mind that interest earned on the deposit is not exempted from Income tax.
There will be no exclusion in the case of Suicide and the full Purchase Price shall be payable.
These are all the major information about Pradhan Mantri Vaya Vandana Yojana.