The Mahila Samman Scheme was introduced in the Budget 2023-24 for two years, ending on March 31, 2025. Should this scheme be continued?
The Mahila Samman Scheme was introduced in the 2023-24 budget to promote women's inclusion in the financial landscape. The scheme became effective in April 2023 and was designed for a limited period of two years. As the tenure ends on March 31, 2025, no further investments will be permitted beyond this date.
This special scheme offers a 7.5 per cent interest rate and is intended for small savings. Announced under the ‘Azadi Ka Amrit Mahotsav’, the scheme aimed to empower women, encourage their participation in financial decision-making, and promote financial independence.
Since there is no age limit for opening this account, it can be opened for a woman of any age, as well as for a minor girl by her parents or guardian. The eligibility criteria are simple, and the account can be opened with a minimum deposit of Rs 1,000, followed by deposits in multiples of Rs 100.
It is like a fixed deposit and only a time investment is allowed in one account. To invest in the scheme again, one should wait for at least three months before another investment can be allowed in the scheme. The maximum investment can be Rs 2 lakh, combining all accounts held by an account holder.
The interest is compounded quarterly and paid at the end of the tenure when the account is closed. The scheme also offers the facility of partial withdrawal of up to 40 per cent after one year from the date of account opening.
If the investor dies before the scheme's maturity, suffers from a life-threatening disease, or the guardian dies, the account can be closed prematurely. Account closure before maturity is allowed after six months for other emergencies, but in any case of premature withdrawal, the interest will be less than 7.5 per cent.
So, overall, this scheme offers women an avenue to save more with benefits exclusive to them.
With the budget announcement around the corner, there are expectations that the government will address the future of this scheme.
Priyadarshini Mulye, a Sebi-registered investment advisor and certified financial planner, says, “Mahila Samman Yojana caters to women across all age and income groups which made it widely accessible too. It has helped women to invest their savings for fixed returns and security”.
She adds that the scheme is simple to understand, and caters to a small amount of investment which is applicable across income groups. Small tenure ensured liquidity available in a short period of time upon maturity. “Considering this, it would be really good if this scheme gets its extension in this FY25 budget too so that more and more women can access and invest in it for their own short-term goals”.
As initially announced, the scheme will end on March 31, 2025, with no further applications accepted beyond this date. However, if extended, it will align with the government’s vision for women's empowerment, particularly benefiting small savers.