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Beneficiaries of Government Welfare Scheme Can Open ‘Basic Savings Account’ in Post Office

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Basic Savings Account can be opened in Post Office

In exercise of the powers conferred under Section 3A of the Government Savings Promotion Act 1873(5 of 1873) Finance Ministry has amended the Post Office Savings Account Scheme, 2019 & the Scheme was named as “Post Office Savings Account (Amendment) Scheme, 2021″.

Following are the Changes after this amendment,

  • Beneficiaries of the Government welfare scheme can open a Basic Savings Account in Post office which is similar to “Basic Savings Bank Deposit Account” (BSBDA).
  • Government had reduced the Account Maintenance Fee from ₹100 to ₹50.
  • Until now BSBDA will be opened in a scheduled commercial bank or Indian Post Payment Bank (IPPB).

Who can avail the account?

  • The account can be opened by a registered adult member of any Government welfare scheme and in case of minor along with guardian who was registered for any government benefit.
  • Basic Savings Accounts which are already opened under the Post Office Savings Account Rules,1981 will not be covered under the new basic savings account.

Basic Savings Account of Post office:

  • Deposit required for opening of account – Nil.
  • Minimum balance to be maintained in the account – Nil.
  • A person can have only one basic savings account in a bank or in the post office.
  • This savings account has all the features and benefits offered by the BSBDA (except the limit of 4 cash withdrawals in a month).
  • Interest rates: 2.75% per annum, with the Frequency of payout at Quarterly and the account can be linked to a POSA (Post Office Savings Account)

The Ministry has reduced Account Maintenance fee POSA:

  • The Post Office Savings Accounts can be opened with a minimum amount of ₹500.
  • Deposit limit –  minimum of ₹10 & no limit on maximum deposit.
  • Withdrawal limit- minimum of ₹50 and no withdrawal will be permitted which has the effect of reducing the balance to less than ₹500.
  • Account Maintenance Fee – ₹100 will be deducted (in case the account balance not raised to ₹500 at the end of the financial year) now, the Finance Ministry has halved the Account Maintenance Fee to ₹50 (inclusive of GST).

Jan Dhan Yojana savings account:

  • It is being the famous savings bank account, which can be opened in any of the bank’s branch or business correspondent’s kiosks or even with India Post Payment Banks. It has 42.20 crore accounts and over ₹1.45 lakh crore balance, the scheme has been successful in distributing the welfare funds.

Recent Related News:

On the lines of the labour welfare initiatives by the Central Government, the Confederation of Real Estate Developers’ Associations of India (CREDAI) has inked memorandum of understanding (MoU) with Indian Payments and Postal Bank (IPPB) to facilitate opening of bank accounts for construction workers.

About RBI guidelines for the BSBDA:

  • An individual is not eligible to have more than one BSBDA in one bank.
  • The BSBDA holder is not eligible to open any other savings bank account in that bank, if he has any then he will be required to close it within 30 days from the date of opening a BSBDA.
  • The customer can have Term/Fixed Deposit, Recurring Deposit accounts in the bank where he holds the BSBDA.
  • There are no restrictions on age and income criteria of the individual for opening BSBDA
  • In BSBDA, banks are required to provide free of charge minimum 4 withdrawals, through ATMs and other mode including RTGS/NEFT/Clearing/Branch