Varishtha Pension Bima Yojana (VPBY) is a pension scheme for senior citizens in India, launched in 2003 by the Government of India. The scheme aims to provide a pension to senior citizens above the age of 60 years. The scheme is open to all citizens of India who are above the age of 60 years. Under the scheme, senior citizens can invest a lump sum amount and receive a guaranteed pension for a period of 10 years.
The scheme is implemented through Life Insurance Corporation of India (LIC) and it provides an interest rate of 7.5% per annum, which is compounded annually. The scheme has a lock-in period of 10 years and the pension amount is paid to the pensioner on a monthly, quarterly, half-yearly or yearly basis, as per the choice of the pensioner.
VPBY allows senior citizens to make a one-time investment and receive a guaranteed pension for a period of 10 years. It is a non-linked, non-participating, and non-market-linked pension scheme. The pension received is guaranteed and is not linked to the market performance. The scheme also provides a life cover during the pension period.
The investment made under VPBY is eligible for tax benefits under Section 80C of the Income Tax Act, 1961. The pension received is also eligible for tax benefits under Section 10(38) of the Income Tax Act, 1961.
VPBY is considered to be an important scheme for providing financial security to senior citizens during their old age. The scheme provides a regular income during their old age and helps them to lead a dignified life. The scheme also provides a life cover during the pension period, which provides a sense of security to the pensioner and his/her family.
To apply for Varishtha Pension Bima Yojana (VPBY), an applicant needs to follow the following steps:
- Obtain the VPBY application form from the nearest branch of Life Insurance Corporation of India (LIC) or download it from the LIC website.
- Fill out the application form with the required personal and financial details, such as name, age, address, income, and investment amount.
- Submit the application form along with the required documents, such as proof of identity, proof of age, and proof of address. The applicant will also have to submit a self-attested photograph and a self-attested photocopy of the PAN card.
- Make the lump sum investment as per the desired pension amount. The investment can be made through cash, cheque, or demand draft.
- After the application is processed and the investment is made, the LIC will issue a receipt for the investment made and a pension plan certificate.
- The pension will start from the date of the investment and the pensioner will receive the pension as per the chosen mode of payment.
It’s important to note that the scheme is closed for new enrollment by govt. of India, but still, people who has already invested in this scheme will be getting the pension as per the terms and conditions mentioned in their certificate. It’s also important to check the terms and conditions of the scheme and to ensure that all the documents are in order before applying.
In conclusion, Varishtha Pension Bima Yojana (VPBY) is a government-funded pension scheme for senior citizens in India. The scheme provides a guaranteed pension for a period of 10 years to citizens above the age of 60 years, who make a lump sum investment. The scheme is implemented through the Life Insurance Corporation of India (LIC) and provides an interest rate of 7.5% per annum, which is compounded annually. The scheme provides a regular income during the senior citizens’ old age, which helps them to lead a dignified life. The scheme also provides a life cover during the pension period, which provides a sense of security to the pensioner and his/her family. The scheme is closed for new enrollment but those who have already invested in the scheme will continue to receive their pension as per the terms and conditions mentioned in their certificate. The government should continue to work on improving the implementation of these schemes and addressing the challenges faced by the senior citizens to ensure their well-being and dignity during their golden years.