Home / Money / Personal Finance /  Mahila Samman Savings Certificate scheme vs bank FDs with high interest rate: Where should you invest?

In a step towards women empowerment, Finance Minister Nirmala Sitharaman, while presenting Budget 2023, launched a one-time small savings scheme for women investors known as the Mahila Samman Savings Certificate (MSSC).

Mahila Samman Savings Certificate (MSSC) savings scheme: Key things to know

Mahila Samman Saving Certificate scheme: Eligibility 

The deposit can be made in the name of a woman or a girl child. 

Mahila Samman Saving Certificate: Amount

The maximum deposit amount has been kept at 2 lakh.

Mahila Samman Saving Certificate scheme:  Tenure

Mahila Samman Savings Certificate, will be made available for a two-year period up to March 2025. 

Mahila Samman Saving Certificate scheme: Interest rate

This will offer deposit facility upto Rs.2 lakh in the name of women or girls for a tenor of 2 years at fixed interest rate of 7.5 per cent.

Mahila Samman Saving Certificate: Withdrawal limit

The government of India has allowed the partial withdrawal option in the Mahila Samman Saving Certificate scheme.

Mahila Samman Saving Certificate: Tax benefits

Small savings schemes qualify for significant tax benefits under Section 80C of the Income Tax Act. However, the taxation structure of the scheme is not known yet.

Mahila Samman Savings Certificate vs bank FD: Interest rate

Country's top lender State Bank of India (SBI) offers an interest of 6.75% much lower than many private and small finance banks. HDFC Bank, ICICI Bank and Kotak Mahindra Bank offer an interest rate of 7% on deposits maturing within two years.

The Mahila Samman Savings Certificate provides an interest rate that is at least 0.50–1% greater than that of the majority of well-known institutions as compared to fixed deposits that are currently being given by big banks, said Amit Gupta, MD, SAG Infotech.

However, investors must determine the bank's security and dependability. It should be mentioned that under the RBI's deposit insurance plan, deposits in scheduled banks—which includes small financing banks—are guaranteed up to 5 lakh. The national government is supporting the Mahila Samman Savings Certificate programme in the meanwhile, he added.

Currently, the top banks, such as State Bank of India (SBI), Axis bank, HDFC, ICICI and Kotak bank, offer an interest rate in the range of 3% - 6.35%, depending on the term. The tenor of the Mahila Samman Savings Certificate is 2 years. For a tenor of 2 years, the interest rate of SBI FDs is 6.75%, Axis bank FDs is 7.26%, HDFC bank FDs is 7%, ICICI bank FDs is 7%, and Kotak bank FDs is 6.75%. Thus, the Mahila Samman Savings Certificate offers 0.50-1% higher interest than the top bank FDs, said Archit Gupta, Founder and CEO, Clear.

However, IDFC First Bank and IndusInd Bank offer interest rates at 7.5% for 2 years FD, the same as the Mahila Samman Savings Certificate. Compared to bank FDs, the Mahila Samman Savings Certificate offers a high-interest rate fixed at 7.5% for a tenor of 2 years with government backing, thereby having no credit risk, he added.




Sangeeta Ojha
A business media enthusiast. Writes on personal finance, banking and real estate.
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