What are Social Security Schemes?
Social Security schemes are those programs which are launched and supervised by the government with primary purpose of bestowing benefits to the society in whole or are focused to provide benefits to particular section of the society.
Such schemes also provide monetary assistance to those who do not have adequate means to survive by themselves. Everyone living in the society has a right to security social security and economical, cultural and cultural well being. Therefore, these schemes are launched for the purpose of targeting the weaker section of the society.
Benefits under the Social Security Scheme
There are various benefits under the social security schemes. They are:
- Disability benefits,
- Dependent benefits, and
- Survivors benefits, etc.
First Scheme: Sukanya Samriddhi Yojana
The Sukanya Samriddhi Yojana is a part of another scheme named Beti Bachao, Beti Padhao. The scheme works for the benefits of the girl child where this scheme can be opened by the parents of the girl child who is below 10 years of age.
Accounts could be opened for two girls only, if there are more girls, the parents cannot open subsequent accounts of the same. The account will be opened since the girl attains 21 years of age or till the girl get married after the age of 18 years.
Who are eligible for the scheme?
The eligibility criteria of the scheme are:
- The account under the scheme can only be opened under the name of the girl child for whose benefit the amount is deposited by the parents.
- The age of the girl child should be below 10 years at the time of opening of the account.
- A single account can be opened of a girl or we can say multiple accounts cannot be opened for the benefit of the same girl.
- A parent can open only two accounts of Sukanya Samriddhi Schemes for two of their daughters.
Investment in the scheme
The parents can invest in the scheme either through the nearby post office or the private and public banks who accepts such scheme. Know Your Customer, or KYC information will be supplied to the bank in like the Aadhaar card, Passport, etc. This information shall be attached to the form and other compliance’s and the initial deposits by cheque or draft.
Benefits of the scheme
This scheme is launched to be a part of the Beti Bachao, Beti Padhao scheme, which has the primary purpose of providing various benefits to the girl child. Some of the benefits of Sukanya Samriddhi Yojana are:
- Tax Reductions: Under this scheme, the government has provided the benefits of tax deduction of Rs. 1.5 lakh annually.
- Return on Investment: The return on the scheme is backed by Sovereign guarantee. This strengthens the faith of the people and they will invest more in the scheme.
- Flexible Investment: The scheme provides an option of flexible investment with minimum deposits of Rs. 250 in a year of which maximum 1.5 lakh per annum.
- High Return: The scheme provide high fix rate of return which is around 8.5 per annum for the year 2018-19. This is much higher than the returns provided by other government schemes such as the Provident Fund.
- Benefit of Compounding: As the scheme needs long time investment which in turn provide for the benefits of compounding.
- Transferable: The bank account can be transferred from one part of the country to another part of the country. This provision was established keeping in mind the transfer of parents.
The scheme was launched to secure the future of the girl child- economically, by encouraging the parents to deposit minimal amount for marital and other expenses of their girls.
Second Scheme: Pradhan Mantri Jan Dhan Yojana
The scheme of Pradhan Mantri Jan Dhan Yojana was launched by the Prime Minister Mr. Narendra Modi in the year 2014, and is operated by the Ministry of Finance.
The scheme provides for easy access to financial resources and services such as, remittance, credit, insurance, pension, and banking, saving, and deposit savings for section of the society who do not have bank accounts. The scheme provides banking services for those who were unable to avail financial services which are mentioned above.
The scheme is generally offered by the government banks, private sector banks and various business correspondents that is Bank Mitr outlets.
Features of the scheme
- All rural and urban households across the country are covered under this scheme. Bank accounts will be opened for around 6 Crore people who are living in villages and around 1.5 Crore people living in the cities.
- The bank accounts which are so opened under this scheme will be providing overdraft facility of Rs. Five thousand which will be for those who has linked their bank accounts to their Aadhaar cards.
- The person who gets himself registered under this scheme will be provided with insurance of RuPay Debit Card which will have inbuilt Rs. 1 lakh for personal accidents which will be provided by the HDFC Ergo and a live cover of Rs. Thirty thousand which shall be provided by the Life Insurance Corporation of India.
Benefits of the scheme
- Loan Benefits: A person who comes under this scheme can take loan of Rs. 5000 per bank account. This might be a less amount but it is more than enough for those who are surviving somehow under the poverty line. This amount will be helpful for them as they will have resources to invest in some productive work which will further get more return from the establishment.
- Insurance Benefits: The benefit of accidental insurance is provided to the account holder which will cover around Rs. 1 Lakh along with a life cover of Rs. 30,000 which will be paid to the beneficiaries of the account holder at the time of the death of the account holder.
- Mobile Banking: Banking is made easy under this scheme as transactions and balance check could now be done while sitting at any part in India.
- Interest: The account holder will get interest on his deposits under this scheme.
- Minimum Balance:The holders of the bank account under this scheme usually come from very poor section of the society and therefore maintaining a minimum balance for them is very difficult. The government has not kept any minimum balance for maintaining these accounts. But, in case the account holder wishes to have cheque book, he will be under obligation to keep minimum balance.
- Direct Bank Transfer: Benefits from various schemes of government and other benefits are directly transferred to the respective bank account to which the benefits were supposed to be transferred.
- Access to Other Schemes: The holder of such bank accounts will get benefits of various schemes of the government such as Pension and other insurance schemes will be easily accessible to the account holder.
Third Scheme: Pradhan Mantri Jeevan Jyoti Bima Yojana
Prime Minister, Mr. Narendra Modi has started Pradhan Mantri Jeevan Jyoti Bima Yojana. It is a life insurance policy that can be renewed on early basis or any other longer period of time. It covers life insurance on the happening of death of the policy holder.
Features of the Scheme
- Coverage of this policy is for a year.
- The policy is renewable and thus could be renewed by the account holder.
- Entry and exit under this scheme is easy. A person can leave the scheme whenever he wishes to do so and can also rejoin whenever he wants.
- The maximum sum offered under this scheme is Rs. 2 lakh.
- The annual premium of this scheme is Rs. 330.
- The process for settlement of claims under this scheme is very easy and could be done without much compliance.
- Anyone between the age group of 18 to 50 years is eligible for the Pradhan Mantri Jeevan Jyoti Bima Yojana.
- A person from this age group who want to enjoy benefits from this scheme should have a bank account.
- Those who get registered under this scheme before the age of 50 years will have an advantage to get the benefits of this scheme till they reach at the age of 55 years.
A person who wants to avail the benefits under this scheme would be under an obligation to pay a premium of Rs. 330 annually. There is no need for the person to go to the bank and deposit this amount as the prescribed amount will automatically be deducted from his bank account from where the scheme is opened.
Termination of Scheme
The offer of the scheme will be terminated on the following occasions:
- When the age of the person exceeds 55 years.
- When the insured person is availing benefits of some other insurance schemes provided by banks.
- When the insured person do not have sufficient bank balance in his registered bank account.
Benefits of Scheme
- Death Benefits:At the death of the insured person, the scheme provides monetary help of Rs. 2 lakh to the beneficiaries of the insured person.
- Maturity Benefits: The scheme does not provide any maturity benefits.
- Tax Benefits: The premium paid under this policy is eligible for deduction under Section 80C of the Income Tax Act, 1961.
- Benefits from Risk: The scheme provides risk coverage for a year. This scheme is renewable and the insured person can renew this scheme after the scheme is terminated or could go for a longer period which is more than a year by linking the auto debit option to the saving bank account.