Benefits of Pradhan Mantri Vaya Vandana Yojana

The Pradhan Mantri Vaya Vandana Yojana, which is a pension scheme launched by the Government of India in favor of senior citizens is managed and controlled by Life Insurance Corporation of India (LIC).

• Interest Rate: This scheme aims to provide fixed rate of return i.e. 7.4% per annum for monthly scheme, 7.45% scheme for quarterly scheme, 7.52% for half-yearly scheme and 7.66% for the yearly scheme for the current financial year, payable monthly and is exempted from GST (indirect tax) for the entire duration of the scheme i.e. 10 years. The interest rates of the scheme are revised every year and set by the Government of India
• Loan Facility: The pensioner can avail a loan amount which is capped at maximum 75% of the investment after the completion of 3 years of the policy. The interest on the scheme is 10% if a loan is availed and the loan is sanctioned upto 30 April, 2018. This interest is paid semi annually for complete scheme duration.
• Death Benefit: In case of death of the pensioner during the terms of policy i.e. 10 years , the benefit of policy can be availed by the nominee or beneficiary.
• Benefit to Family: The benefits of the policy can be availed by the pensioner, spouse of that persons and the family members dependent on him.
• Maturity benefit: The purchase price and the final pension instalment are paid to the pensioner on completion of the policy.
• Free-Look Period: It is the period in which a policy holder or pensioner can close the scheme if he is not happy with it or do not want to continue further. The free look up period is 15 days in case the policy is bought offline. If the policy is purchased online then the pensioner has an additional time period of 15 days to close the policy which makes it a total 30 days for online purchased policies. Only the stamp charges are deducted and the entire amount paid by the pensioner is paid back to him.

The Government of India has introduced the new pension scheme called PM Vaya Vandana Yojana (PMVVY) after the success of Varishtha Pension Bima Yojana 2003 and Varishtha Pension Bima Yojana 2014. The main goal of the scheme is to provide the elderly with a regular pension during a time of falling interest rates so that can secure their future. PMVVY can be activated from 4 May 2017 to 31 March 2020. LIC has been chosen to implement the scheme and issue policies. Let us discuss about PMVVY in detail. This scheme has now been further extended for a period of 3 years and the time period for the policy activation is 3 years i.e. upto March 2023.