SCSS (Senior Citizens' Savings Scheme) Interest Rate
This scheme last updated its deposit rates on 01-Jul-26.
Scheme Overview
SCSS is India's highest-yielding guaranteed income instrument built specifically for retirees. It converts a retirement corpus into a steady quarterly paycheque backed by the sovereign guarantee — which is why it remains the anchor of most retirement income plans.
- Interest rate: 8.20% p.a., paid quarterly on 1 April, 1 July, 1 October and 1 January.
- Minimum / Maximum deposit: ₹1,000 to ₹30 lakh per individual (the cap applies across all SCSS accounts held). A couple can therefore hold up to ₹60 lakh (₹30 lakh each).
- Tenure: 5 years, extendable in blocks of 3 years.
- Lock-in: 5 years, though premature exit is allowed with a penalty.
- Eligibility: Residents aged 60 and above; those 55–60 who retired under VRS or superannuation (account opened within one month of receiving benefits); retired defence personnel from age 50. NRIs and HUFs are not eligible.
- Premature withdrawal: Permitted anytime after opening. If closed before 1 year, interest already paid is recovered. Between 1 and 2 years, a 1.5% penalty on the principal applies; after 2 years, a 1% penalty. On the account holder's death, the account closes without any penalty and the nominee receives the full amount with interest.
- Tax benefit: Deposit qualifies under Section 80C (old regime). Interest is fully taxable at your slab; TDS applies if annual interest crosses the threshold (submit Form 15H if not liable). Senior citizens can also claim up to ₹50,000 under Section 80TTB.
- Payout: Quarterly interest credited to the linked account. Partial withdrawals are not allowed — early exit means closing the whole account.
Government Schemes — At a Glance
| Scheme | Rate (p.a.) | Tenure | Max Deposit | Eligibility | Early Closure | Tax Benefit | Payout |
|---|---|---|---|---|---|---|---|
| 7.10% | 15 yrs | ₹1.5L / year | Residents | Conditional | Yes | At maturity | |
| 8.20% | 21 yrs | ₹1.5L / year | Girl child | Conditional | Yes | At maturity | |
| 8.20% | 5 + 3 yrs | ₹30 lakh | Age 60+ | Yes | Yes | Quarterly | |
| 7.70% | 5 yrs | No limit | Residents | No | Yes | At maturity | |
| 7.50% | 1–5 yrs | No limit | Residents | Yes | Yes | Annual | |
| 6.70% | 5 yrs | No limit | Residents | Yes | No | At maturity | |
| 7.40% | 5 yrs | ₹9L / ₹15L joint | Residents | Yes | No | Monthly | |
| 7.50% | 115 months | No limit | Resident | Yes | No | At maturity |
Interest rates are for the July–Sept 2026 quarter and are revised quarterly by the Ministry of Finance. This is for educational purposes and is not investment or tax advice — verify current figures on India Post or NSI before investing.
Frequently Asked Questions
The Senior Citizens' Savings Scheme pays 8.2% per annum for the July–September 2026 quarter, paid out quarterly — among the highest guaranteed rates for retirees. The rate is fixed at the time of deposit for the full term, but is reviewed every quarter for new accounts.
SCSS is open to residents aged 60 and above. Those aged 55–60 who retired under VRS or superannuation can join if they invest within one month of receiving benefits, and retired defence personnel qualify from age 50. NRIs and HUFs cannot open an SCSS account.
The maximum is ₹30 lakh per individual, across all SCSS accounts held, and the minimum is ₹1,000. Because the limit is per person, a senior couple can invest up to ₹60 lakh between them — ₹30 lakh each — in separate accounts.
SCSS has a 5-year tenure, which can be extended in blocks of 3 years any number of times. On extension, the account earns the rate applicable on the maturity date. Interest continues to be paid quarterly throughout the extended period.
Yes, premature closure is allowed anytime after opening, but with a penalty. Closing within 1 year means interest already paid is recovered. Between 1 and 2 years a 1.5% penalty applies on the deposit, and after 2 years a 1% penalty. Death attracts no penalty.
Yes, SCSS interest is fully taxable at your income-tax slab. The deposit qualifies for a Section 80C deduction under the old regime, but the quarterly interest is taxed. TDS applies if annual interest crosses the limit; submit Form 15H if not liable. Seniors can claim ₹50,000 under Section 80TTB.
SCSS interest is paid quarterly — on 1 April, 1 July, 1 October and 1 January — directly into your linked account, making it a popular regular-income option for retirees. Partial withdrawals are not allowed, so accessing funds early means closing the whole account.