Pradhan Mantri Vaya Vandana Yojana (PMVVY)
In the current financial year of 2017-18, the Central government has decided to launch a new Pension Scheme named Pradhan Mantri Vaya Vandana Yojana (PMVVY). The scheme would be launched for Senior Citizens for a guaranteed rate of return. This scheme similar to Varishtha Pension Bima Yojana which was launched during 2014-15.
What is Pradhan Mantri Vaya Vandana Yojana (PMVVY):
The Central government has launched a Senior Citizen Pension Scheme named Pradhan Mantri Vaya Vandana Yojana (PMVVY) Plan No. 842. This is a pension plan with subsidized pension rates which will provide an assured return of 8% per annum payable monthly (equivalent to 8.30% per annum) on the pensioner surviving during the policy term of 10 years. The scheme is specially launched for citizens aged 60 year and above.
Pradhan Mantri Vaya Vandana Yojana (PMVVY) Special Features:
Age: The scheme is specially launched for senior citizens aged 60 years and above are eligible to invest in PMVVY.
Policy Terms: The policy term is for 10 years.
Assured Return: The assured return is 8% p.a. Effective annually yield works out to 8.30% for a monthly pension.
Pension Payment: The plan provides for pension payments of stated amount for the policy term of 10 years, with the return of purchase price at the end of 10 years.
Premium Payment: One-time premium payment of around Rs 1,44,578/- fetches a monthly pension of Rs 1,000 for 10 years. (Under PMVBY, the pension was for life-long.)
Medical: No medical examination is required.
Policy Surrender: The premature exit is allowed during policy term under exceptional circumstances like Critical/Terminal illness of self or spouse. Surrender Value payable in such cases is 98% of the Purchase Price.
Loan Availability: Loan is available under the policy after completion of 3 policy years. Maximum loan granted will be 75% of the purchase price.
Service Tax-Free: The scheme is available for sale with free ‘service tax’.
Plan Availability: Purchasing of PMVVY new pension plan is open from 04-May-2017 to 03-May-2018.
How to Purchase Pradhan Mantri Vaya Vandana Yojana (PMVVY):
The plan can be purchased through the both online or offline by payment of a lump sum Purchase Price. The pensioner has an option to choose either the amount of pension or the Purchase Price.
Offline: The Plan available for sale from 04 May 2017 through the LIC of India.
Online: This plan is also available for online sale from LIC of India website https://eterm.licindia.in
Benefits of Pradhan Mantri Vaya Vandana Yojana (PMVVY):
Pensioner will get the pension during the policy term, pension in arrears (at the end of each period as per mode is chosen by the pensioner) will be payable.
In the death case of the pensioner during the policy term, the Purchase Price will be refunded to the nominee (or legal heirs in absence of nominee)
On survival of pensioner to the end of the policy term, Purchase Price and final installment of the pension will be paid to the pensioner.
Mode of Pension Payments/Pension Rates/Pension Options under PMVVY:
Pension payment modes are available in Monthly / Quarterly/Half-yearly /Yearly.
Minimum and maximum Purchase price under different modes of Pension
|Mode of Pension||Minimum Purchase Price||Corresponding Pension Amount|
|Yearly||1,44,578||12,000 per annum|
|Half-Yearly||1,47,601||6,000 Half year|
|Quarterly||1,49,068||3,000 per Qtr.|
|Monthly||1,50,000||1,000 per month|
Minimum and maximum Pension under different modes of Pension:
|Mode of Pension||Maximum Purchase Price(Rs)||Corresponding Pension Amount|
|Yearly||7,22,892||60,000 per annum|
|Half-Yearly||7,38,007||30,000 per half year|
|Quarterly||7,45,342||15,000 per Qtr.|
|Monthly||7,50,000||5,000 per month|
Pension rates payable under different modes of Payment(Yearly, Half Yearly, Quarterly, Monthly) are as under:
|Mode of Pension||Effective Pension Rate per annum for rs. 1000/- purchase price|