Finance Ministry rolls out high-yield special fixed deposit scheme for senior citizens

• Aims to support senior citizens during economic reforms and rising living cost, effective 1 July to 31 December 2025
• Offers enhanced returns on fixed deposits for those aged 60+ to strengthen financial security
• Maximum deposit limit set at Rs. 1 m per individual for 12-month term, at higher of the bank’s fixed deposit rate or AWFDR plus 3%, with monthly withdrawals
• Scheme applies through 17 licensed commercial banks—5 State and 12 private
• Seniors must certify monthly income under Rs. 150,000, ownership of funds and consent to data verification
• National ID and TIN are required to open accounts under Govt. allocates Rs. 15 b to subsidise the interest payments

The Finance Ministry yesterday announced the rollout of the special interest scheme for senior citizens 2025, offering enhanced returns on fixed deposit savings for individuals aged 60 and above, offering higher interest rates to support their financial security.

On 16 June, the Cabinet of Ministers approved the move as proposed in the Budget 2025, which took effect from yesterday (1) and will run through 31 December 2025 (https://www.ft.lk/front-page/Govt-rolls-out-high-yield-fixed-deposit-scheme-for-senior-citizens/44-777916). 

The scheme was introduced to ensure a stable and enhanced return on savings to provide greater financial security for senior citizens during a period of economic reform and transition.

“The decision to provide relief was made in response to several critical factors, including the high cost of living, reduced market interest rates, and the increasing financial challenges faced by senior citizens, particularly in managing essential expenses like healthcare costs. Recognising the need to support this vulnerable group, the Government has prioritised the facilitation through this scheme,” the Finance Ministry added. Eligible senior citizens will be permitted to place fixed deposits of up to Rs. 1 million across participating banks, with each deposit having a 12-month tenure. Participants will receive the higher of the bank’s published fixed deposit rate or the Average Weighted Fixed Deposit Rate (AWFDR) plus 3% per annum, with interest payments to be withdrawn monthly.

The scheme will be available through 17 Licenced Commercial Banks (LCBs)—five State banks and 12 private banks which have confirmed participation.

As part of the process, senior citizens who wish to open accounts under the scheme will be required to certify that their monthly income is below Rs. 150,000, that the funds deposited are their own and that they consent to share relevant data with the Finance Ministry for verification. 

The Ministry noted that any false declaration would disqualify depositors from receiving the interest subsidy.

In addition, senior citizens keen to open accounts under this scheme must present their National Identity Card (NIC) and Taxpayer Identification Number (TIN) issued by the Inland Revenue Department (IRD), along with other required documents, at any branch of the participating banks from 1 July onward.

In total, the Government has allocated Rs. 15 billion under Budget 2025 to subsidise the interest payments to banks, ensuring senior citizens receive their enhanced returns promptly and without disruption.

The Finance Ministry said the scheme demonstrates the Government’s commitment to safeguarding the welfare of senior citizens and ensuring that this nationally important program is implemented efficiently and transparently.