How frequently is interest calculated and credited to the bank account of a depositor in the Senior Citizens' Savings Scheme (SCSS)?

[ A ]Daily

[ B ]Monthly

[ C ]Only once at the end of 5 years upon maturity

[ D ]Quarterly (on the first working day of April, July, October, and January)[ CORRECT ]

Takeaway

Interest on Senior Citizens' Savings Scheme deposits is credited quarterly, on the first working day of April, July, October, and January, so option D is correct.

Derivation

SCSS is structured to provide senior citizens with regular, predictable income, and this is achieved through quarterly interest payouts rather than monthly, daily, or maturity-only crediting. This distinguishes it from related small savings products such as the Post Office Monthly Income Scheme (which pays monthly) or cumulative instruments like NSCs (which pay only at maturity). This is a fact-recall question testing whether candidates can correctly distinguish SCSS's specific payout frequency from similarly-purposed but structurally different government savings schemes that a case study on retirement income products would naturally compare it against.

Why the others fail

A — Daily

SCSS interest is not calculated or credited on a daily basis; it follows a quarterly payout schedule.

B — Monthly

Monthly interest crediting describes the Post Office Monthly Income Scheme (POMIS), a different product from SCSS, which pays quarterly.

C — Only once at the end of 5 years upon maturity

Paying interest only once at maturity describes cumulative instruments like National Savings Certificates, not SCSS, which provides regular quarterly income.