The Government has issued one more clarification on demonetised currency. If you possess old Rs 500 and Rs 1,000 notes, depositing them in Small Savings Schemes (SSS) will be out of bounds. In other words, scrapped currency will not be accepted to invest in PPF, NSC, Sukanya Samriddhi scheme and Kisan Vias Patra, among others.

The RBI recently issued a circular addressing banks in this regard which read:

“Government of India has decided that subscribers of Small Savings Schemes may not be allowed to deposit SBNs (Specified Bank Notes) in Small Savings Schemes. Banks have been advised not to accept SBNs for deposits in Small Saving Schemes with immediate effect. However, deposits into Post Office Savings account are permitted.”

Jan Dhan accounts have witnessed an unprecedented 60% rise in deposits since the Government scrapped old Rs 500 and Rs 1,000 notes. As reported widely in media, these accounts have received inflows of nearly Rs 21,000 crore, which has raised eyebrows; but the Government will scrutinise suspcious accounts.

On the aforesaid backdrop, to curb the misuse of small savings schemes, the Government seems to have decided to disallow deposits in SSS through old currency.

PersonalFN is of the view that, disallowing people to deposit their money in legitimate SSS accounts is unfair. For starters, opening SSS accounts involves a robust KYC (Know Your Customer) process. This should make it easy for the Government to scrutinise those SSS accounts that have received suspicious sums.

Among other things, PersonalFN also believes, issuing a new circular every day exposes the Government’s unpreparedness to launch a large-scale operation that has inconvenienced a majority of citizens.

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