New Delhi, May 3: In a major relief to senior citizens, the government on Wednesday doubled the investment limit to Rs 15 lakh under the Pradhan Mantri Vaya Vandana Yojana (PMVVY) pension scheme. Along with this, the government also extended the subscription period by two years until March 31, 2020. It must be noted that the subscription period was to end on Thursday i.e. May 3.

The latest move will guarantee a maximum pension of Rs 10,000 a month under the Pradhan Mantri Vaya Vandana Yojana. It must be noted that the Pradhan Mantri Vaya Vandan Yojana is for citizens aged 60 years and above. It was opened for subscription from May 4, 2017 to May 3, 2018.

The scheme provides an assured pension based on a guaranteed rate of return of 8 per cent per annum for ten years, with an option to opt for the pension on a monthly, quarterly, half-yearly or annual basis. The scheme provides an assured pension based on a guaranteed rate of return of 8 per cent per annum for ten years, with an option to opt for pension on a monthly, quarterlyhalf-yearlyly or annual basis.

According to a government release, the decision was taken on Wednesday at the Union Cabinet meeting that was chaired by Prime Minister Narendra Modi, IT and Law Minister Ravi Shankar Prasad.  Soon after the meeting, Prasad informed that the Cabinet has approved increasing the investment limit from Rs 7.5 lakh to Rs 15 lakh as well as the extension of the subscription period for PMVVY as part of the government's commitment to financial inclusion and social security.

As of March 2018, 2.23 lakh senior citizens had subscribed to PMVVY. In the previous scheme, Varishtha Pension Bima Yojana-2014, 3.11 lakh senior citizens have invested. The PMVVY is being implemented through Life Insurance Corporation of India (LIC) to provide social security and protect the elderly, 60 years and above, against a future fall in their interest income due to uncertain market conditions.  The difference between the return generated by LIC and the assured return of 8 per cent annually will be borne by the government of as a yearly subsidy.

To recall, the Pradhan Mantri Vaya Vandana Yojana was launched on May 4, 2017, and covers 2.23 lakh senior citizens as of March 2018. This figure is apart from the pension coverage provided by Varishtha Pension Bima Yojana, re-launched in August 2014, to 3.11 lakh senior citizens.

(The above story first appeared on LatestLY on May 03, 2018 08:52 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).