Selvamagal Semippu Thittam, which was recently launched by the Department of Posts, is growing popular as one of the higher interest earning savings schemes. In the past one month, nearly 50,000 accounts have been opened in the Chennai city region, including Vellore
What does the scheme entail?
| The scheme was launched exclusively for girl children. A parent or gaurdian can open an account in the name of the child | Thought the age limit for opening an account is set at 10 years,the age limit has been relaxed to 11 years for the first year after launch | The scheme with an interest rate of 9.1% will be credited to the account. The depositor can choose to get it after the full term of the deposit or collect it as a monthly interest | Though the senior citizens savings scheme has the highest interest rate at 9.2%. The selvamagal scheme also provides exemption from income tax |
What are the requirements for signing up?
| Address proof document of the parent/guardian and birth certificate or school certificate of the account holder is essential. Nominations are not allowed | A minimum of Rs.1000 has to be deposited in a year. There is no limit on the number of deposit in a month or in a year. However, the maximum amount that can be deposited is Rs 1.5 Lakhs every year |
If the minimum deposit for a year is not made, the account will be discontinued but can be revived with a penalty of Rs. 50. This is only available at post offices and not through postal agents
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Duration
There is a provision for partial withdrawal up to 50 per cent of the deposit amount for purposes like higher education when the account holder turns 18
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Thouqh the deposit period is 21 years. it can be closed when the account holder produces proof of marriage.
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Premature closure of the account will be allowed only after the account holder turns 18. otherwise the account can be closed after 21 years.
| The account holder can continue to operate the savings scheme even after its maturity |
From the Expert
Mervin Alexander, postmaster general (Chennai city region)
The minimum lock-in period of the deposit works out to only eight years. After 18 years, the girl child can operate and withdraw from the account. People prefer this because of the attractive interest rate and the flexibility of the period for the deposits to be made. Customers can hold an account even in a small post office.
