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Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a subsidized pension scheme categorically introduced for senior citizens above the age of 60. It is a government backed pension scheme that provides an alternate source of pension planning to the elderly. It is exclusively available through the LIC of India. You can contact any LIC agent to subscribe to this policy or log on to their website to purchase this policy.

The PMVVY Policy is unique in that; it offers assured returns on your investment. The returns are paid in the form of fixed pension at regular intervals as chosen by the policyholder. The policy also comes with a maturity benefit and death benefit giving additional assurances to the family of the pensioner.

It was initially announced from 4th May, 2017 to 31st March, 2020. It was recently extended up to 31st March 2023, for a further period of three years beyond 31st March, 2020.

Benefits of Pradhan Mantri Vaya Vandana Yojana

  • Scheme initially offers a fixed rate of return of 7.40% p.a. for 2020-21and shall be reset every year on April 1st.
  • Annual reset of the fixed interest rate will be done on April 1st of the financial year in accordance with the revamped rate of return of the Senior Citizens Savings Scheme (SCSS) up to a total of 7.75%.
  • Pension is due at the end of each year, during the ten-year term of the policy, on the basis of the monthly/quarterly/half-year/year frequency preferred by the pensioner at the time of purchase.
  • The scheme is excluded from GST.
  • The purchasing price along with the last pension instalment shall be payable on the pensioner's survival at the end of the policy term of 10 years.
  • Loan up to 75% of purchase price is permitted after 3 policy years (to meet any liquidity needs). Loan principal shall be recovered from the pension instalments and the loan to be recovered from the proceeds of the claim.
  • The system also provides for an early exit for the management of any critical/terminal disease of the person or the spouse. On such early withdrawal, 98% of the purchase price shall be refunded.
  • The purchase price shall be paid to the beneficiary upon the death of the pensioner within the policy term of 10 years.
  • The highest pension ceiling is for the household as a whole, the family will be made up of the pensioner, his/her spouse and the dependents.
  • The deficit attributed to the disparity between the interest assured and the real interest received and the administrative cost shall be subsidised by the Government of India and reimbursed to LIC.
  • Free Look Period: After buying a policy, if individuals are not satisfied with the terms and conditions set out in the contract, they may return the scheme within 30 days from the date of receipt in the event of an online transaction. However, the free lock-in time for offline purchasing is 15 days from the date of purchase of the policy. Around the same time, a justification for objection must be given in the return of this policy. The entire sales amount, after deduction of any relevant stamp duty or pension contribution, shall be refunded during this free look period.

Salient Features of Pradhan Mantri Vaya Vandana Yojana

PMVVY is open only to people who are 60 years of age or older. The PMVVY is a pension fund for senior citizens with fixed dividends on a monthly, quarterly, half-yearly or annual basis for a term of 10 years. As an investor, you can choose your investment either on the pension amount you want to receive or the purchase price you are able to invest in PMVVY.

The cumulative investment that can be made in PMVVY is limited to Rs. 15 lakhs per senior citizen and the maximum monthly pension for PMVVY is Rs. 9250 per senior citizen. Thus, if both partners are over 60 years of age, the maximum monthly pension could be Rs. 18,500 with a family contribution of Rs. 30 lakhs. The pension in the PMVVY does not depend on the age of the investor.

The updated PMVVY would have a lower investment interest rate than before. Unlike in the older version of PMVVY, the interest rate in the modified PMVVY will fluctuate depending on the financial year (FY) in which the investment is made.

The scheme is valid for 10 years and for investments made in the fiscal year 20-21 to 31st March 2021, the government has declared the interest rate to be payable at 7.4% per month i.e. 7.66% per year for a period of 10 years. For investments made in the next two fiscal years, i.e. 2021-22 and 2022-23, the Government will announce the interest rate of the PMVVY at the beginning of each fiscal year.

Application Process for Pradhan Mantri Vaya Vandana Yojana

Senior citizens can enrol for this policy either online or offline. As mentioned earlier, the policy is available only with LIC. So here are the steps to enrol for the PMVVY Policy:

Offline Process:

  • Contact your nearest branch of LIC office
  • Alternatively, you can also get in touch with an LIC Agent in your locality
  • Ask of the relevant application form for this policy
  • Fill in the form and attach all the requested documents, duly self-attested
  • LIC shall process your application and send the policy document to your communication address
  • You can also manage your policy through the eLIC portal online. 

Online Process: 

  • LIC has an online portal, eLIC, for the purchase and management of the policies
  • Register and login on to the eLIC portal
  • Go to the Pension Plans tab and choose the PMVVY product
  • Go to the buying option which will open the application form
  • Fill in all the details in the given fields
  • Attach the scanned copies of all the supporting documents
  • Submit your application and make the first premium payment
  • The application shall be processed and the policy document shall be sent to your communication address

What is the eligibility criteria for PMVVY?

Here are the eligibility criteria to apply for Pradhan Mantri Vaya Vandana Yojana (PMVVY):

  • The person must be at minimum 60 years of age (completed) before entering the scheme.
  • There is no limit age for enrolling to the policy
  • Must be an Indian resident
  • Minimum Policy Duration – 10 years

What are the documents to be submitted during the application process?

Here are the documents required to enrol for PMVVY: 

  • Aadhaar Card
  • Identity Proof 
  • Address Proof
  • Passport size photos of the applicant

PMVVY – Minimum and Maximum Investment

Mode of PensionYearlyHalf-yearlyQuarterlyMonthly

Minimum investment 

(Purchase Price) 

Rs. 1,56,658

Rs. 1,59,574

Rs. 1,61,074

Rs. 1,62,162

Maximum investment 

Rs. 14,49,086

Rs. 14,76,064

Rs. 14,89,933

Rs. 15,00,000

PMVVY – Minimum and Maximum Pension Amount

Minimum PensionMaximum Pension

Rs. 1,000 per month

Rs 9,250 per month

Rs. 3,000 per quarter

Rs. 27,750 per quarter

Rs. 6,000 per half-year

Rs. 55,500 per half-year

Rs. 12,000 per year

Rs. 1,11,000 per year

What is the pension payment mode?

Pension payout options can be monthly, quarterly, half-yearly or annual. The first instalment of the pension shall be received after 1 year, 6 months, 3 months or 1 month from the date of purchase of the same, based on the mode of payment you have chosen, i.e. annual, half-yearly, quarterly or monthly.


No Suicide Exclusion: There is no deduction on the count of suicide and the full purchase price is payable.


1. Who is the administrator of the PMVVY?

On behalf of the Government of India, Life Insurance Corporation of India is to be the PMVVY administrator.

2. What is the term of this scheme? Is there any upper limit on age for purchasing this scheme?

The scheme is valid for a term of 10 years. There is no upper age limit to purchase this policy.

3. Will the insurance rate agreement for the whole ten-year policy period be the same when it is acquired, or will the interest rate payable to the policy at the time of purchase change for the policyholder annually?

The contract rate will remain the same for the whole ten years of the policy as was the rate on the fiscal year the policy is bought. This is the policy interest rate acquired during F.Y. Return of 7.40% p.a. will be guaranteed in 2020-21. For a full 10-year period, payable on a monthly basis (equivalent to 7.66% p.a.). The applicable guaranteed rate of interest at which the pension payment is made, is reviewed and determined by Ministry of Finance, Government of India at the beginning of the fiscal year for the policies sold in the next two financial years i.e. Financial Year 2021-22 and 2022-2023. Once the interest rate on policies acquired in that financial year is however fixed, it will remain constant for a complete 10-year cycle.

4. How is this scheme different from the earlier versions of Pradhan Mantri Vaya Vandana Yojana?

The guaranteed pension rates for policies purchased for the year are reviewed by the Ministry of Finance of the Government of India, and are determined at the start of each year. The plan shall have an assured pension of 7.40% p.a. for the first financial year, i.e. up until 31 March 2021 that was payable monthly. The guaranteed amount of pension was 8.00% p.a. in the earlier edition of PMVVY that was payable monthly.

5. Will the overall purchase price under this scheme have any restrictions?

Complete purchase price under all policies under this Scheme and all policies implemented under the previous versions of Pradhan Mantri Vaya Vandana Yojana given to a senior citizen shall not exceed Rs. 15 lakhs.

6. Is it possible to surrender the policy adopted in this scheme? What are the terms of surrender under this scheme?

The policy enforced under this scheme could be surrendered at any point within the policy period. They can surrender it under extraordinary situations, such as a pensioner needing money or to treat any ill health of themselves or their spouse.

7. Can one avail a loan under the scheme? What is the rate of interest on such loans availed under this scheme?

One can apply for a loan upon completion of three policy years. The highest loan that can be approved is 75% of the purchasing amount. The interest rate to be paid for the amount of the loan shall be set at periodic intervals. For the loan approved before 30 April 2021, the interest rate payable to the earlier iterations of this arrangement is 9.5% p.a. for the full length of the loan.

8. How is the interest and loan principal restored under this scheme?

Loan principal will be recovered from the balance of the pension payable by the policy. Loan interest will accrue on the basis of the frequency of payment of the pension under the agreement which will be due on the due date of the pension. However, the outstanding debt shall be repaid from the proceeds of the claim at the time of exit.

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