Confusion, anger over restrictions in 15 % deposit rate eligibility to senior citizens

Confusion once again prevailed on Monday when senior citizens called at commercial banks to make use of the 15 per cent interest on deposits not exceeding Rs. 1 million and were informed of new restrictions.

They were told that eligibility to this scheme were only for those who had an aggregate (total) of Rs. 1 million or less in all banks put together. This meant anyone having a fixed deposit of anything over Rs. 1 million at any bank was not eligible though the budget proposal didn’t give this impression.

“This is downright cheating the public,” said one irate 60-year depositor.

In Finance Minister Ravi Karunanayake’s January 28^th interim budget, these were his words: “I am happy to announce that the senior citizens will be receiving a higher interest rate of 15% per annum for their savings up to a maximum level of Rs. 1 million for funds deposited in commercial banks”.

Most people, and even banks, at the time interpreted this as senior citizens being eligible to open one, single Rs.1 million fixed deposit at a rate of 15 per cent from whatever funds they had, irrespective of how much they had in banks.

The Central Bank circular issued to banks on February 25 also noted that depositors who had opened accounts upto Rs. 2.5 million at 12 per cent and subsequently Rs. 1 million at 12 per cent following the pronouncement in the Mahinda Rajapaksa budget presented in October 2014, were also eligible to this new interest rate. – ENDS -