The government is going to make important changes in the small savings schemes of the post office. These schemes include PPF, Sukanya Samriddhi Yojana, National Savings Account etc. Interest will be deducted if there is more than one PPF account. The new changes will come into effect from October 1, 2024. The Department of Economic Affairs under the Ministry of Finance has issued guidelines regarding the rules. It states that if an account is found to be irregular, it will have to complete the necessary compliance procedures otherwise the account may be closed.
The department has identified six categories for the changes. These mainly include irregular National Savings Scheme accounts, PPF accounts opened in the name of minors, more than one PPF accounts, extension of PPF accounts by NRIs and regularization of Sukanya Samriddhi accounts opened by grandparents apart from parents.
PPF Account
1. Multiple accounts : In such a case, applicable interest will be payable only on the primary account, provided the deposit amount is within the maximum limit applicable for each year.
The balance of the second account will be merged with the first account, provided the primary account remains within the applicable investment maximum limit each year.
After the merger, the primary account will continue to receive the applicable interest rate. Excess balance (if any) in the secondary account will be refunded with zero percent interest rate.
The primary account would be considered as the one where the investor wishes to continue with the respective account (either with post office or a bank, chosen one) after the merger.
If there is a third account, the interest will become zero from the date of opening it.
2. Account in the name of minor: Irregular PPF accounts opened in the name of children or minors will get the normal post office savings account interest rate till they attain majority. On attaining majority, they will get PPF interest rate.
Sukanya Samriddhi Scheme
In cases of accounts opened by grandparents (who are not legal guardians), the guardianship of the account will be transferred to the legal guardian of the child.
If two accounts are opened in the same family, the irregular account will be closed. Irregular account means not depositing the minimum amount annually.
Irregular National Savings Account
Rules have been changed for three types of accounts related to National Savings Scheme. This includes two accounts opened before April 1990 and more than two accounts opened after that.
In this, 0.20 percent post office savings account interest will be added extra for the first type of accounts. Whereas normal interest will be given on other types of accounts.
No interest will be paid on the third account, instead their principal amount will be refunded.
Directions to Post Offices
All post offices will have to collect PAN card and Aadhaar card details from the account holders. The system will have to be updated before submitting the regularization application. Account holders will have to be informed about these changes.
