The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved extending the investment limit from Rs 7.5 lakh to Rs 15 lakh under the Pradhan Mantri Vaya Vandana Yojana (PMVVY).
It also extended the last date for subscription to the scheme till March 31, 2020. The time limit was earlier supposed to end on May 4 this year.
The PMVVY is being implemented through Life Insurance Corp (LIC) to provide social security during old age and protect the elderly aged 60 years and above against a future fall in their interest income due to uncertain market conditions.
The scheme provides an assured pension based on a guaranteed rate of return of 8 per cent per annum for 10 years.
The differential return, which is the difference between the return generated by LIC and the assured return of 8 per cent per annum, would be borne by the government as subsidy on an annual basis.
“As a boost to the social security initiatives for senior citizens, the investment limit of Rs 7.5 lakh per family in the existing scheme is enhanced to Rs 15 lakh per senior citizen in the modified PMVVY, thereby providing a larger social security cover to the senior citizens.
“It will enable up to Rs 10,000 pension per month for senior citizens,” an official statement said.