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Pradhan Mantri Vaya Vandana Yojana (PMVVY)

Written by - Akshatha Sajumon

February 12, 2022 6 minutes

The Government of India periodically introduces various social security schemes based on the requirements of citizens. Some of the functional schemes introduced by the government are National Pension Scheme, Public Provident Fund (PPF), Atal Pension Yojana, Senior Citizens Saving Scheme, etc.

These schemes are popular among people who wish to financially plan and manage their retirement. One of the latest additions to the list of such schemes is Pradhan Mantri Vaya Vandana Yojana (PMVVY). This is a retirement and pension scheme operated and managed by the Life Insurance Corporation of India (LIC). 

Here, we will discuss all the important details about the scheme that an investor needs to know.

What is Pradhan Mantri Vaya Vandana Yojana?

Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a subsidized retirement plus pension scheme introduced by the Indian Government in May 2017. Any funds invested in the scheme by investors is referred to as the purchase price. Since this is a sovereign guaranteed scheme, it offers an assured rate of return on investment.

The scheme offers regular pensions with a frequency of monthly, quarterly, or yearly. The PMVVY is a good alternative to traditional bank deposits.

Eligibility criteria for PMVVY

Some of the eligibility criteria applicable for enrolling in Pradhan Mantri Vaya Vandana Yojana are:

  • The applicant must be at least 60 years of age (completed) at the time of enrolling for the scheme
  • No maximum age limit is applicable for entering into the policy
  • Applicant must be an Indian citizen
  • Minimum policy term is 10 years

Documents required for enrolling to PMVVY

Here are some of the essential documents required to be furnished by an applicant while enrolling into Pradhan Mantri Vaya Vandana Yojana:

  • Aadhaar Card
  • Proof of Age
  • Proof of Residence
  • Recent passport size photos of the applicant
  • Necessary document/Declaration of retired status of the applicant

How to apply to PMVVY

There are certain steps to be followed for enrolling in PMVVY. Mentioned below are the online and offline versions:

Offline Process:

  • Application forms can be sought from any of the LIC branches
  • The applicant must then fill the form with relevant details
  • Next step is to attach all the essential self-attested documents 
  • Lastly, one must submit the form by attaching all the documents at any LIC branch

Online Process:

  • Visit the official LIC website
  • Click on “Products”
  • Search for “Pension Plans” 
  • Fill the application form that is available under “Buy Policies”
  • Submit the form and self-attested document soft copies for further process

Modes of payment for Pradhan Mantri Vaya Vandana Yojana

Pension payments are to be made as per time periods selected by the pensioner at the time of applying for the scheme. These periods can be monthly, quarterly, half-yearly, or yearly. The modes of pension payment are as follows-

  • NEFT
  • Aadhaar Enabled Payment System

PMVVY scheme validity

In May 2020, the government declared the PMVVY scheme subscription open till 31st March 2023. The scheme can be purchased offline as well as online through the official LIC website.

Maximum investment in PMVVY

A subscriber can invest up to Rs.15 lakhs in the PMVVY scheme. This limit is applicable to the primary investor. Thus, if an investor’s spouse is older than 60 years, he/she can invest up to Rs. 15 lakhs in the scheme separately. To avail a return of Rs. 1,000 per month from the scheme, the minimum investment required is Rs. 1.5 lakhs.

Returns under PMVVY

Pradhan Mantri Vaya Vandana Yojana (PMVVY) provides a return of 7.4% per annum. If an investor subscribes to a monthly pension scheme, the annual interest can range between 7.4-7.6%. Since the scheme is primarily a pension plan, it does not attract any GST or service charge.

There is no income tax relief attached to the scheme and the returns are taxable in the hands of the investor. The difference between interest generated by the LIC and the assured returns of 8% are borne by the Government of India and paid to LIC as a subsidy.  

Advantages of Pradhan Mantri Vaya Vandana Yojana

Here are some of the noteworthy benefits of Pradhan Mantri Vaya Vandana Yojana:

  • The scheme offers 7.4% returns p.a payable as per the frequency chosen by the investor for a period of 10 years
  • Taxes, including Service tax, or GST, are not applicable to PMVVY investment
  • Throughout the scheme tenure of 10 years, the pension is payable in arrears as per frequency chosen by investor, such as, monthly/quarterly/half-yearly/yearly
  • The entire investment value, including the purchase price and final pension amount, is payable at the end of scheme term of 10 years, in case the pensioner survives the term
  • In case of an emergency, an investor can seek a loan of up to 75% of principal value after 3 years of policy term completion. The interest on such a loan is recovered from pension installments and the loan amount is recovered from claim proceeds.
  • In case the pensioner dies during the term, the purchase price is paid to the nominee

Pradhan Mantri Vaya Vandana Yojana- Pension Policy

The minimum pension assured under the scheme is Rs. 1,000 – Rs. 10,000 per month, depending on the principal invested.

Mode of PensionMinimum Pension (in Rs)Minimum Investment (in Rs.)Maximum Pension (in Rs.) Maximum Investment (in Rs.)
  • Since the scheme term is 10 years, the investor gets back the principal investment along with the final pension installment upon completion of 10 years.
  • In case of the death of the investor before completion of 10 years, the principal amount is credited to the nominated beneficiary’s account.
  • The amount of pension is irrespective of the age of the subscriber.


PMVVY is a good risk-free investment option for senior citizens or retired individuals above the age of 60 years. The pension from the scheme can act as a regular source of income to support the financial needs of retired individuals. However, to invest in this scheme, one must have sufficient liquid funds.


  1. What are the exclusions of Pradhan Mantri Vaya Vandana Yojana?

There are no exclusions under the PMVVY scheme once an investment has been made. Even if a pensioner commits suicide, no exclusion is applicable and full purchase price is payable to the beneficiary.

  1. Can I make a premature exit from PMVVY?

The PMVVY scheme allows premature exit in case of critical illness of an investor or his/her spouse. In such cases, the investor is refunded 98% of the invested principal. The remaining 2% is charged as a premature exit penalty. If the investor commits suicide, 100% of the purchase price is refunded to the nominee.

  1. What are the investment options for senior citizens in the country?

Some of the commonly used and preferred investment options for senior citizens are debt mutual funds, NPS, PPF, bank fixed deposits, Atal Pension Yojana, etc.

  1. What is the monthly income scheme?

The Monthly Income Scheme is managed by the Indian postal service. It ensures the investor a guaranteed return at 6.6% per annum in the form of monthly income. 

  1. What is the maximum amount allowed to be invested in PMVVY?

The maximum investment amount allowed in PMVVY is Rs. 15 lakhs.

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