Special interest scheme for senior citizens over 60 to cover all banks

Wednesday, 31 December 2014 00:48 - - {{hitsCtrl.values.hits}}

12% interest rate or Rs. 300,000 annual income on fixed deposits up to Rs. 2.5 m
Participating banks will receive special bond to be issued by Govt. at interest of 12%

The Central Bank said yesterday all deposit holders above 60 years of age and holding rupee fixed deposits totalling up to Rs. 2,500,000 in licensed banks will be eligible to receive an annual interest rate of 12%, amounting to income of up to Rs. 300,000, with effect from 1 January 2015. The move was in keeping with 2015 Budget proposal which recommended 12% special annual interest rate scheme for deposits of citizens over 60 years of age, who maintain the fixed deposits in all licensed banks with a view to providing a higher interest income for senior citizens. For this purpose, the necessary operating instructions have been issued to all licensed banks who will be the participating banks in this scheme. All licensed banks, operating in Sri Lanka that maintain fixed deposit accounts shall implement this special interest scheme with effect from 1 January 2015. The private banks that participate in the proposed scheme will be expected to actively participate in financing government development activities, in consultation with the Department of Development Finance of the Ministry of Finance. All participating banks will be required to pay an annual interest of 12% on the deposits up to Rs. 2,500,000 maintained by a senior citizen with effect from 1 January 2015, up to a maximum of Rs. 300,000 for the year. The participating banks, will, in turn, receive a special bond to be issued by the Government at an interest of 12% per annum, in order to cover the additional interest cost incurred by them, under this scheme. The interest income on these deposits will be exempted from income tax.

CB to unveil 2015 Road Map on Friday

The announcement of the Central Bank’s ‘Road Map : Monetary and Financial Sector Policies for 2015 and Beyond’ will be made by Governor Ajith Nivard Cabraal on Friday, 2 January 2013 at 09.30 a.m. at the Bandaranaike Memorial International Conference Hall (BMICH) at Bauddhaloka Mawatha in Colombo 07.