Sri Lanka’s Central bank to provide 12 pct interest scheme for senior citizens

[First Guy]

Dec 30, 2014 (LBO) – Sri Lanka’s Central Bank to provide 12 percent annual interest rate scheme for deposits of citizens over 60 years of age, who maintain fixed deposits totaling up to 2,500,000 rupees in licensed banks, will be eligible to receive an annual interest income of up to 300,000, rupees with effect from 1st of January 2015.

This action was taken according to the budget 2015 proposal, the bank said in a media release.
For this purpose, the necessary operating instructions have been issued to all licensed banks who will be the participating banks in this scheme.

Media Release reproduced

1.All licensed banks, operating in Sri Lanka that maintain fixed deposit accounts shall implement this special interest scheme with effect from 1 January 2015.
2. The private banks that participate in the proposed scheme will be expected to actively participate in financing government development activities, in consultation with the Department of Development Finance of the Ministry of Finance.

3. All Participating Banks will be required to pay an annual interest of 12 per cent on the deposits up to Rs. 2,500,000 maintained by a senior citizen with effect from 1 January 2015, up to a maximum of Rs. 300,000 for the year.

4. The Participating Banks, will, in turn, receive a special bond to be issued by the Government at an interest of 12 per cent per annum, in order to cover the additional interest cost incurred by them, under this scheme.

5. The interest income on these deposits will be exempted from income tax.

http://www.lankabusinessonline.com/news/sri-lanka%E2%80%99s-central-bank-to-provide-12-pct-interest-scheme-for-senior-citizens/827046434

[First Guy]

* 12% interest rate or Rs. 300,000 annual income on fixed deposits up to Rs. 2.5 m
* Participating banks will receive special bond to be issued by Govt. at interest of 12%

The Central Bank said yesterday all deposit holders above 60 years of age and holding rupee fixed deposits totalling up to Rs. 2,500,000 in licensed banks will be eligible to receive an annual interest rate of 12%, amounting to income of up to Rs. 300,000, with effect from 1 January 2015.

The move was in keeping with 2015 Budget proposal which recommended 12% special annual interest rate scheme for deposits of citizens over 60 years of age, who maintain the fixed deposits in all licensed banks with a view to providing a higher interest income for senior citizens.

For this purpose, the necessary operating instructions have been issued to all licensed banks who will be the participating banks in this scheme.

All licensed banks, operating in Sri Lanka that maintain fixed deposit accounts shall implement this special interest scheme with effect from 1 January 2015.
The private banks that participate in the proposed scheme will be expected to actively participate in financing government development activities, in consultation with the Department of Development Finance of the Ministry of Finance.

All participating banks will be required to pay an annual interest of 12% on the deposits up to Rs. 2,500,000 maintained by a senior citizen with effect from 1 January 2015, up to a maximum of Rs. 300,000 for the year.

The participating banks, will, in turn, receive a special bond to be issued by the Government at an interest of 12% per annum, in order to cover the additional interest cost incurred by them, under this scheme.

The interest income on these deposits will be exempted from income tax.

http://www.ft.lk/2014/12/31/special-interest-scheme-for-senior-citizens-over-60-to-cover-all-banks/

[sereneTop contributor]

Thanks 1st G.
Good Decision.