Banking woes of senior citizens

In some private banks, you find special counters for clergy, the disabled and elderly account holders manned by well-dressed officers, who always address the customers politely and with a smile. However it is not the same at state banks.Senior citizens have to meet medical expenses connected to various pathological tests recommended by medical specialists. Today most septuagenarian and octogenarian citizens exist on lifelong prescriptions. At state banks, chronic hindrances prevent them from standing for long durations.

When I visited a particular bank, a couple of days ago, the place was chock a bloc with customers including two very old ladies and a gentleman standing in a winding queue.

I approached the head of the branch, who gave me a patient hearing and immediately summoned the two senior customers and accepted the cash payments promptly himself; a courteous act indeed. However, state banks in general have earned the reputation of being lethargic and showing little concern for aged customers. I believe that all state banks should have a special senior citizens counter. Banking assistants should also be trained to attend to these elders in a courteous manner. Over to you, CEOs of all State Banks.

Withholding Tax

The Ministry of Finance needs to make a clarification on the withholding tax of 10 percent to be deducted if the interest exceeds Rs.108,000/- per annum (or Rs.9,000 a month) and whether this is applicable to over sixties as well. If not, this would mean senior citizens would have to pay a 10 percent tax on their meagre income whereas others will pay only a 5% tax on the first Rs.500,000 of their earnings.

Enhancement of Senior Citizens Special Interest Scheme

Under the state granted Special Interest Scheme— which is applicable for senior citizens over 60 years of age, and subject to a Maximum deposit amount of Rupees 1.5 Million at 14.060 % for one year FD if interest is claimed monthly, or 15% if interest is paid at maturity. This rate and the Deposit limit was fixed a few years ago when the bank interest rates were rather low compared to today’s rates. As declared by financial experts the consequences of the CB bond scam has caused the market rates of interest for normal FDs to rise from earlier 7 to 8 percent up to current 9 to 11 percent.

The inflationary effects that followed have pushed the cost of living index also to adjust at higher levels. It is time that the Minister considers an enhancement of the interest from the present 15 percent to a reasonable 18-20%, along with an upper limit of 2.5 Million deposit. This will help nonpensioner corporate sector retirees to invest their hardearned EPF/ETF [part of which has already been gobbled up by Bond scoundrels] plus gratuity payments in meeting at least their cost of medication.

K. K. S. Perera

Panadura