Deposits of senior citizens increased, government received tax of Rs 27,000 crore in FY 2024

Tags: Economy/Finance

Total deposits in senior citizen accounts are expected to increase by 143% to reach Rs 34.367 lakh crore by December 2023, compared to Rs 13.724 lakh crore in 2018.

An Overview of the News

• Fixed deposit accounts of senior citizens increased by 81% to about 7.4 crore in December 2023 from 4.1 crore in 2018.

• An estimated 7.3 crore accounts have balances of more than Rs 15 lakh, which attract 7.5% interest, resulting in a total interest of Rs 2.7 lakh crore in FY24, including Rs 2.57 lakh crore from bank deposits and senior citizens. This includes Rs 13,000 crore from the savings scheme.

• The average amount of fixed deposit account per senior citizen increased by 39% to Rs 4.63 lakh by December 2023 from Rs 3.34 lakh in 2018.

• The government collected around Rs 27,000 crore of tax from senior citizens on interest earned from fixed deposits in FY24, with the TDS limit raised to Rs 50,000.

• Additional incentives, such as interest rate hike of 50 basis points and enhanced deposit insurance cover (increased from Rs 1 lakh to Rs 5 lakh with effect from February 4, 2020), have made bank deposits more attractive for senior citizens.

About SBI

Chairman: Dinesh Kumar Khara

Headquarters: Mumbai, Maharashtra

Established: July 1, 1955

Tagline: "Banker for every Indian"