Small Savings Schemes: Govt defined rules regarding joint accounts

Post office small savings schemes come with a variety of options for both short and long-term investors. Ranging from PPF to SCSS, small savings schemes are considered as one of the most secure investments apart from fixed deposits of banks. In small savings schemes, one can open an account individually or jointly by making an initial contribution towards his or her account. For joint account holders or individuals who want to open a small savings scheme jointly, the government has issued several guidelines.

Account opening, eligibility, identification of depositor, mode of deposit, payment of interest, types of accounts, operation of an account opened in the name of a minor, transfer of an account, nomination, payment on the death of a depositor, pledging of an account, issue of passbook, deposit, transfer, payment of the eligible balance in an account held by Army, Air Force and Navy personnel, closure of an account, loans and partial withdrawal, recovery of excess amount paid, and withdrawal of from an account are all clearly specified in the Government Savings Promotion General Rules, 2018.

The government's declaration is essential since, in contrast to a single account, Joint A and Joint B Type Accounts are permitted under the post office savings schemes. A Joint A-Type Account can be opened on behalf of up to three adults and payable to all the account holders jointly or to the survivor or survivors, whereas a Joint B-Type Account can be opened in the names of up to three adults and payable to any of the depositors or to the survivor or survivors. In the event of a Joint B Type account, the Department of Economic Affairs of the Ministry of Finance has stated that any of the account holders or the surviving depositor may conduct any type of account activity.

A Single Account that has been opened cannot be modified to a Joint Account or vice versa. An account holder in a single account under a savings scheme who wishes to create a joint account under the same savings scheme may do so, pertaining to the total deposit or account limit applicable to that savings scheme. An account holder in a Joint Account under a savings scheme who wishes to create a single account under the same savings scheme may do so pursuant to the total deposit and account limit applicable to the savings scheme. That being said, in the case of Non-CBS Post Offices and transfer to Branch Post Offices, the signature of all holders in a Joint Account, either A-type or B-type, must be acquired.

As a result, all account activities, such as account closure, duplicate passbook issuance, and account transfer, shall be permitted to be conducted by either of the joint holders or survivor in the case of a Joint B Type account in regard to all schemes except Senior Citizens' Saving Scheme (SCSS). Under SCSS, depositors can open an account jointly or individually. The entire contribution in a joint account is only accountable to the primary holder or first holder of the account. Under the SCSS account, only quarterly interest withdrawals are permitted by either of the joint depositors or the survivor in the case of the Joint B Type account.