New Delhi: The Centre has significantly increased the interest rate on deposits under the Senior Citizens Welfare Fund (SCWF), raising it to 6.85 per cent per annum for the financial year 2025-26 from 3.35 per cent in the previous fiscal.
The revised rate was notified by the Ministry of Finance’s Department of Economic Affairs through a notification issued on June 5, 2026. According to the notification, the new interest rate will be effective retrospectively from April 1, 2025, and will remain applicable until March 31, 2026.
The increase marks a sharp reversal from the previous financial year, when the interest rate had been reduced from 7.15 per cent in FY 2023-24 to 3.35 per cent in FY 2024-25. The latest revision restores much of that decline, although the rate remains slightly below the 7.15 per cent level seen two years ago.
The Senior Citizens Welfare Fund was established by the Central Government under Section 128 of the Finance Act, 2015, with operational rules notified in March 2016 by the Ministry of Finance.
The fund receives money from unclaimed deposits and dormant accounts across various financial instruments, including Small Savings Schemes, Employees’ Provident Fund, Public Provident Fund accounts, life and non-life insurance policies, and Coal Mines Provident Fund accounts. Financial institutions are required to identify such unclaimed amounts annually and transfer them to the fund after adjusting for valid claims.
Funds accumulated under the SCWF are utilized for programmes aimed at the welfare and well-being of senior citizens, in accordance with the National Policy on Older Persons and the National Policy on Senior Citizens.
The latest hike in the interest rate is expected to strengthen the fund’s corpus and enhance resources available for initiatives benefiting elderly citizens across the country.
