Mahila Samman Saving Certificate Scheme - Eligibility, How to Apply, Calculation, Interest Rate, Tax Benefits

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The Mahila Samman Saving Certificate, 2023, is available from 01/04/2023 in the Post Offices at an interest rate of 7.5% p.a.

The Union Finance Minister, Smt. Nirmala Sitharaman announced Mahila Samman Saving Certificate, a new small savings scheme for women and girls, in her Budget Speech 2023-24. The Mahila Samman Savings Certificate scheme was announced to commemorate the Azadi ka Amrit Mahotsav. 

The Mahila Samman Savings Certificate is a one-time scheme available for two years, from April 2023-March 2025. It will offer a maximum deposit facility of up to Rs.2 lakh in the name of women or girls for two years at a fixed interest rate. 

Features of Mahila Samman Savings Certificate 

Below are the features of the Mahila Samman Savings Certificate, 2023:

1. Government-Backed Scheme: Mahila Samman Savings Certificate scheme is a small savings scheme backed by the government. Hence, it does not have any credit risk. 
2. Eligibility: The Mahila Samman Savings Certificate can be done only in the name of a girl child or woman. A woman or the guardian of a minor girl child can open a Mahila Samman Saving Certificate scheme.
3. Deposit Limits: The minimum deposit amount under the Mahila Samman Savings Certificate is Rs.1,000 in multiples of rupees one hundred. The maximum deposit amount is Rs.2 lakh in one account or all Mahila Samman Savings Certificate accounts held by an account holder. A woman or guardian of a girl child can open a second Mahila Samman Savings Certificate account after a minimum gap of three months from the opening of the existing account.
4. Maturity: The maturity period of the Mahila Samman Savings Certificate account is two years. Thus, the maturity amount will be paid to the account holder after two years from the account opening date. 
5. Withdrawal: A partial withdrawal facility is provided under the Mahila Samman Saving Certificate scheme. The account holder can withdraw up to 40% of the account balance after one year from the account opening date. 
6. Tax Benefits: Tax Deducted at Source (TDS) is not deducted from the interest received under this scheme. However, CBDT notified that TDS would apply to the Mahila Samman Saving Certificate Scheme. As per Section 194A of the Income Tax Act, TDS will apply only when the interest received from the post office savings scheme in a financial year is more than Rs.40,000 or Rs.50,000 (in the case of senior citizens). Since the interest amount of this scheme for a maximum of Rs.2 lakh investment for two years does not exceed Rs.40,000, TDS is not deducted from the interest received under the Mahila Samman Saving Certificate Scheme.
7. Interest Rate of Mahila Samman Savings Certificate: This scheme has a fixed interest rate of 7.5% p.a., much higher than most bank Fixed Deposits (FDs) and other popular small savings schemes. The interest will be credited quarterly and paid at the time of closure of the account. 

Premature Closure of Mahila Samman Savings Certificate

The Mahila Samman Savings Certificate account can be closed before two years in the following situations:

• After six months of opening the account without giving any reason. In such a case, an interest of 5.5% will be given.
• On the death of the account holder. In such a case, the interest will be paid on the principal amount.
• In the case of an extreme compassionate ground, such as: 
  • A life-threatening disease of the account holder.
  • Death of the guardian upon production of relevant documents. In such a case, the interest will be paid on the principal amount.

Banks Offering Mahila Samman Savings Certificate

The Department of Economic Affairs, Ministry of Finance authorised all public sector banks and qualified private sector banks to operate the Mahila Samman Savings Certificate scheme through an e-gazette announcement on 27 June 2023. The list of qualified banks offering this scheme is as follows:

• Bank of Baroda
• Canara Bank
• Bank of India
• Punjab National Bank
• Union Bank of India
• Central Bank of India

How to Open a Mahila Samman Savings Certificate?

Women and guardians of a girl child can open a Mahila Samman Savings Certificate scheme at post offices and qualified scheduled banks. 

Opening of Mahila Samman Savings Certificate at post office 

• Download the ‘Application for purchasing the certificate’ from the official Indian Post website. You can also visit the nearest Post Office branch and get the form.
• Fill out the Post Office address under the ‘To The Postmaster’ section.
• Fill in your name in the given space and mention the account as 'Mahila Samman Savings Certificate’. 
• Fill out the account type, payment and personal details.
• Fill out the declaration and nomination details.
• Submit the form with the required documents.
• Make the deposit in the Post Office through cash or cheque.
• Receive the certificate that serves as proof of investment in the Mahila Samman Savings Certificate scheme.

Opening of Mahila Samman Savings Certificate at Banks

• Fill out the required details on the application form. 
• Fill out the declaration and nomination details.
• Submit the form to the bank's branch office with the required documents.
• Deposit the scheme opening account with the bank officials. 
• Receive the certificate that serves as proof of investment in the Mahila Samman Savings Certificate scheme.

Documents Required for Mahila Samman Savings Certificate Account

• Application form
• KYC documents, such as an Aadhaar card, Voter ID, driving license and PAN card 
• KYC form for new account holders 
• Pay-in-Slip along with deposit amount or cheque

Mahila Samman Savings Certificate Calculation

Let’s look at the benefit of opening a Mahila Samman Savings Certificate account. Suppose you invest Rs.2,00,000 under the scheme; you get an interest fixed at 7.5% yearly. Thus, in the first year, you will get Rs.15,000 interest on the principal amount, and in the second year, you will get Rs.16,125 interest. Thus, by the end of two years, you will get 2,31,125 (2,00,000 initial investment + 31,125 interest for two years). Thus, your maturity amount, which you get after two years, will be Rs.2,31,125.

Mahila Samman Savings Certificate Vs Other Small Savings Schemes

The government has introduced many small savings schemes, which are investment tools for people. The popular savings schemes are Public Provident Fund (PPF), National Savings Certificate (NSC), Senior Citizens Small Savings Scheme (SCSS) and Sukanya Samriddhi Yojana (SSY). Let’s look at the comparison of other small savings schemes with the Mahila Samman Savings Certificate.

PPF Vs Mahila Samman Savings Certificate 

NSC Vs Mahila Samman Savings Certificate 

SCSS Vs Mahila Samman Savings Certificate 

SSY Vs Mahila Samman Savings Certificate