Varishtha Pension Bima Yojana 2020 – 8% Guaranteed Return
PM Narendra Modi has given a post-facto approval nod to Varishtha Pension Bima Yojana – an insurance scheme which has been designed for the Silver Generation of India with one view – protecting their financial security against market fluctuations. It is a known fact that most of the senior citizens in India are today dependent on the interest earnings from various investment schemes. However, they are barely covered under any insurance scheme. To provide insurance cover and also to provide a monthly income stream, the Varishtha Pension Bima Yojana has been launched by the Union Government.
The State-run insurance giant – Life Insurance Corporation of India will be providing this insurance plan. The salient features of this scheme are:
- 8% guaranteed interest earnings.
- The interest earnings will be provided to the subscribers in form of pension.
- Pension payouts can be:
- Every 3 months
- Every 6 months
- The 8% guaranteed interest will be provided for 10 years straight.
- Only senior citizens – people of 60 years of age or older than that – will be eligible for this scheme.
It is known fact that the markets are volatile and providing 8% guaranteed interest for a decade is not logical. However, to cover LIC against any losses that it makes if the interest rates happen to fall below 8% anytime during the 10-year period, the government will absorb the loses and will provide subsidies to the insurance giant to continue with its 8% percent guaranteed interest per year.
According to the government officials, the Varishtha Pension Bima Yojana is just a scheme launched towards the government’s commitment to achieve financial inclusion and provide social security for all Indians.
The scheme has only received approval for a launch. It has not yet been launched. However, once the scheme is launched, subscriptions will stay open for 1 year starting from the launch date.
As of now, no further information is available. Once we get hold of more information, we will provide with necessary updates.