PMVVY PM Yojana – Pradhan Mantri Vaya Vandana Yojana 2023

The Pradhan Mantri Vaya Vandana Yojana (PMVVY PM Yojana) is a pension scheme for senior citizens launched by the Indian government in 2017. This scheme offers a guaranteed payout of pension to senior citizens for a period of 10 years. The scheme was extended for three years till March 2023 in the Union Budget 2020-21. In this article, we will provide a comprehensive guide to the PMVVY PM Yojana.

What is the Full Form of PMVVY PM Yojana?

The full form of PMVVY is Pradhan Mantri Vaya Vandana Yojana. It is a government-backed pension scheme for senior citizens aged 60 years and above, launched by the Ministry of Finance in May 2017.

What is PMVVY PM Yojana?

The PMVVY PM Yojana is a pension scheme for senior citizens of India. It is a guaranteed pension scheme that offers a fixed rate of return for 10 years. The scheme is available for senior citizens who are 60 years of age and above. The scheme is managed by the Life Insurance Corporation of India (LIC).

Benefits of PMVVY PM Yojana

The PMVVY PM Yojana offers the following benefits:

Guaranteed Returns

The scheme offers a fixed rate of return for 10 years. The current rate of return is 7.4% per annum. The returns are guaranteed by the government of India.

Pension Payouts

The pension payouts are made on a monthly, quarterly, half-yearly, or yearly basis, as chosen by the policyholder. The minimum pension payout is Rs. 1,000 per month, while the maximum is Rs. 9,250 per month.

Death Benefit

In case of the death of the policyholder during the policy term, the purchase price of the policy is refunded to the nominee.

Maturity Benefit

At the end of the policy term of 10 years, the purchase price of the policy along with the final pension installment is paid to the policyholder.

Tax Benefits

The policy offers tax benefits under Section 80C of the Income Tax Act, 1961. The pension income is taxable under the head “Income from Other Sources”.

Eligibility for PMVVY PM Yojana

The following are the eligibility criteria for the PMVVY PM Yojana:

Age Limit

The scheme is available for senior citizens who are 60 years of age and above.

Purchase Price

The minimum purchase price for the policy is Rs. 1.5 lakh, while the maximum purchase price is Rs. 15 lakh.

Policy Term

The policy term is 10 years.

Payout Options

The pension payouts can be chosen on a monthly, quarterly, half-yearly, or yearly basis.

How to Apply for PMVVY PM Yojana?

The PMVVY PM Yojana can be applied for online or offline. The following are the steps to apply for the scheme:

Online Application

1. Visit the official website of LIC.
2. Click on the “Buy Policy Online” option.
3. Fill in the required details and select the PMVVY PM Yojana policy.
4. Make the payment online.
5. The policy document will be sent to the registered email ID.

Offline Application

1. Visit the nearest LIC branch.
2. Fill in the PMVVY PM Yojana application form.
3. Submit the required documents along with the form.
4. Make the payment through cheque or demand draft.
5. The policy document will be sent to the registered address.

Documents Required for PMVVY PM Yojana

The following are the documents required to apply for the PMVVY PM Yojana:

Age proof (any one of the following):

• Birth certificate

• Passport

• PAN card

• Voter ID card

Address proof (any one of the following):

• Aadhaar card

• Passport

• Voter ID card

• Driving license

• Utility bills

Identity proof (any one of the following):

• Aadhaar card

• PAN card

• Passport

• Voter ID card

Bank details for the pension payouts.

PMVVY PM Yojana vs Other Pension Schemes

The PMVVY PM Yojana is one of the several pension schemes available for senior citizens in India. Let’s compare the PMVVY PM Yojana with some of the other popular pension schemes:

National Pension System (NPS)

The National Pension System (NPS) is a market-linked pension scheme. The returns on the scheme are not guaranteed, but the scheme offers the potential for higher returns than the PMVVY PM Yojana. The NPS also offers more flexibility in terms of the choice of fund manager and investment options. However, the NPS has a longer lock-in period of 15 years, while the PMVVY PM Yojana has a lock-in period of 10 years.

Atal Pension Yojana (APY)

The Atal Pension Yojana (APY) is a government-backed pension scheme for unorganized sector workers. The scheme is available for individuals between the ages of 18 and 40. The scheme offers a fixed rate of return and a guaranteed pension for life after the age of 60. The APY has lower contribution limits than the PMVVY PM Yojana, and the returns are lower as well.

Disadvantages of PMVVY PM Yojana

While the Pradhan Mantri Vaya Vandana Yojana (PMVVY) offers many benefits for senior citizens, it also has some disadvantages. Here are some of the potential drawbacks to consider before investing in the scheme:

1. Low returns: The PMVVY scheme offers guaranteed returns, but the interest rates are relatively low compared to other investment options available in the market. While the safety of guaranteed returns is a positive aspect of the scheme, the returns may not be sufficient for some investors.
2. Limited investment amount: The PMVVY scheme has a maximum investment limit of Rs. 15 lakh per person. This may not be sufficient for individuals who require a higher income during their retirement years.
3. Limited payout options: The PMVVY scheme offers only two payout options – monthly and quarterly. Some investors may prefer more flexibility in terms of payout frequency.
4. Lock-in period: The PMVVY scheme has a lock-in period of 10 years. This means that investors cannot withdraw their investment before the end of the term without incurring surrender charges.
5. Taxation of payouts: The pension income received from the PMVVY scheme is taxable under the head “Income from Other Sources”. This may reduce the effective returns for some investors.
6. No loan facility: Unlike some other pension schemes, the PMVVY scheme does not offer the option to take a loan against the policy.

What is the PMVVY PM Yojana interest rate

The Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a government-backed pension scheme that offers guaranteed returns to senior citizens. The scheme is administered by the Life Insurance Corporation of India (LIC), and the interest rate for the scheme is fixed by the government.

As of March 2023, the interest rate for the PMVVY scheme is 7.4% per annum. The interest is payable monthly, and the payout options are monthly, quarterly, half-yearly, or yearly. The returns from the PMVVY scheme are guaranteed, which means that investors can be assured of a fixed income during their retirement years.

It is important to note that the interest rate for the PMVVY scheme is subject to change from time to time, based on the government’s policies and market conditions. Therefore, investors should keep an eye on the prevailing interest rates and choose the best option for their financial goals.

In addition to the guaranteed returns, the PMVVY scheme also offers a death benefit to the nominee in case of the investor’s death. The death benefit is equal to the purchase price of the policy, and it is tax-free.

Conclusion

The PMVVY PM Yojana is a great pension scheme for senior citizens in India. The scheme offers guaranteed returns, flexible payout options, and tax benefits. The scheme has a short lock-in period of 10 years, making it an attractive option for senior citizens who are looking for a steady source of income in their retirement years. However, it is important to compare the PMVVY PM Yojana with other pension schemes to determine the best option for your specific needs and financial goals.

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