Increase interest rate to senior citizens

Wednesday, 8 May 2024 00:00 - - {{hitsCtrl.values.hits}}

The Government has approved a payment of 15% interest for fixed deposits made by senior citizens up to now. I wish to mention that this was a great monthly income boon to officials of the Government, corporations, various boards and universities who received EPF lump sum retirement benefits without a monthly Government pension.

Not so long ago in the 2021/2022 years, bank rates went up to around 20 – 24 % per month. Due to this reason the 15% interest rate scheme for seniors was scrapped by the banks. Currently seniors receive a paltry 7-8% interest for FDs.

University officials, lecturers and staff receive a lump sum payment of EPF on retirement (no monthly pension). This 15% special FD scheme supported them to live happily using the income for medicines and living expenses. It must be pointed out that this group does not have any other source of income than bank interest.

This was the situation at that time when there was no severe poverty in the country. But now the situation is very bad - cost of living has gone up by leaps and bounds and living itself has become a struggle for this group of people who served the country diligently. For some retirees it has become a nightmare as they receive no financial support from children and they have to put in some financial assistance for children as well from the current paltry interest.

I must mention that this sudden reduction of interest rates to 7-8% has hit them below the belt. They are in dire straits due to the current inflation and high cost of medicines etc. and it is a daily challenge and a stress for them to live peacefully in retirement.

Another point is that the 15% interest was limited to a maximum FD of Rs. 1.5 million. This is not sufficient now, I suggest that this maximum amount be put up to Rs. 3 million at least. We humbly request the Government to consider our plight and reintroduce the 15% scheme with a maximum of Rs. 3 million, so that we can live with our dignity and self-respect. This is an urgent current necessity to improve the living status of retirees who solely depend on interest income.

Jayalath Muttewegedera

President

University Executive Retirees Association