(Updated – 2nd June 2023)
After the Budget announcement where the government announced a new one-time female-specific small savings scheme – Mahila Samman Saving Certificates 2023 (MSSC), we now have full details of the scheme available, which we discuss below. Later on, we will see whether you should invest in Mahila Samman Savings Certificate 2023 or not.
The Mahila Samman Savings Certificate 2023 will be available for a period of 2 years, starting from 1st April 2023 to 31st March 2025 and will offer a fixed interest rate of 7.5%. Only women or girls can deposit in the MSSC scheme in Indi, that is, Mahila Samman Savings account 2023 can only be opened by a woman or girl for herself, or by the guardian on behalf of a minor girl. Partial withdrawal is also allowed subject to certain limits. There would be no additional tax benefits on this scheme. This is a one-time scheme announced in Budget 2023 and will remain available for a 2-year period only up to March 2025. You can invest in this new scheme either through Post Offices or with any of the authorized banks.
Here are a few simple FAQs for answering some common questions about Mahila Samman Savings Certificate.
What is interest rate of Mahila Samman Savings Certificate (2023)?
The interest rate is fixed at 7.5% per annum for a period of 2 years. But since the interest will compound on a quarterly basis, the effective rate comes close to 7.71% instead.
What is the tenure of the Mahila Samman Savings Certificate (2023)?
The tenure of the new small savings scheme for women is 2 years.
What is the Maturity amount calculation for Mahila Samman Savings Certificate (2023)?
You can use this free-to-download excel-based Mahila Samman Savings Calculator. You can download it to use and calculate how much should be the maturity amount of your Mahila Samman Savings scheme investments.
What is Maximum & Minimum Investment in Mahila Samman Savings Certificate (2023)?
The minimum amount that is to be invested in Mahila Samman Savings Certificate is Rs 1000. The maximum upper investment limit for MSSC 2023 is Rs 2 lakh. MSSC allows one to open as many accounts as one wants but the total upper limit of investments remains fixed at Rs 2 lakh per depositor. But in opening more than one account, there should be a gap of at least 3 months between the existing one and the new opening date.
Do investments in Mahila Samman Savings Certificate qualify for section 80C tax benefit? Or let’s instead ask – Is there any tax benefit for investing in Mahila Samman Savings Certificate (2023)?
No there are no special tax benefits available for investing in Mahila Samman Savings Certificate. The interest income will be taxable as per the income tax slab of the women depositors. So to answer the question Do investments in Mahila Samman Savings Certificate qualify for section 80C tax benefit – the investment under the Mahila Samman Savings Scheme does not qualify for a rebate under section 80C of the Income Tax Act.
Can I make a partial withdrawal from Mahila Samman Savings Certificate (2023)?
If you are looking for the Premature withdrawal rules for Mahila Samman Savings Certificate 2023, then the good news is that partial withdrawals are allowed to be made from Mahila Samman Savings Certificate. Women can withdraw a maximum of up to 40% of the Eligible Balance once after the expiry of one year from the date of opening of the account but before the maturity of the account by submitting an application (via Form-3).
Should I Invest in Mahila Samman Savings Certificate (2023)?
I think this new Mahila Samman Savings Certificate is suitable for those women who generally aren’t part of the formal small savings instruments (for the short term) and giving them a higher rate of interest (compared to many bank FDs) will encourage such women to adopt this and other small saving instruments in times to come.
If you are a woman looking to park money for just 2 years, then Mahila Samman Savings Certificate can be a worthwhile option, but given the investment limit of just Rs 2 lakh (one time) and a very short tenure of 2 years, I think most women investors can skip this scheme. But at least for the Rs 2 lakh you can invest here, you get better returns compared to many of the bank fixed deposits and post office time deposits.
This scheme is quite different from the girl-child-focused Sukanya Samriddhi Yojana. As quoted in a MoneyControl news item (link), my view is that “While both the newly announced Mahila Samman Savings Certificates and existing Sukanya Samriddhi Yojana cater to savings for women, the latter is only for parents looking to save for the girl child’s long-term future,” says Dev Ashish, a SEBI-Registered Investment Advisor (RIA) and Founder of StableInvestor. He added, MSSC having a two-year tenure is a short-term product, and hence, cannot ideally be compared with long-term instruments such as SSY.
So those were the details and features about the newly announced Mahila Samman Savings Certificate 2023 which is available for 2 years from April 2023 to March 2025 and offers an interest rate of 7.5% per year.