PMVVY Complete Guide — Pradhan Mantri Vaya Vandana Yojana 2026
📘 PMVVY — LIC’s Government-Backed Senior Citizen Pension Scheme
Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a Government of India–backed pension scheme for senior citizens (60+) operated by LIC. It guarantees a fixed pension for 10 years in exchange for a lump sum investment, with the principal returned at the end of the 10-year term. At 7.4% (same as POMIS but lower than SCSS’s 8.2%), PMVVY is not the highest-yielding senior citizen instrument — but its 10-year guaranteed pension duration makes it a useful complement for those who want income locked in for a decade. This guide explains PMVVY mechanics, compares it to SCSS and POMIS, and helps senior citizens determine if it belongs in their income portfolio.
📊 PMVVY Data — India 2025-26
- LIC, March 2026: PMVVY policies outstanding: 18.4 lakh. Total PMVVY corpus: Rs2.1 lakh crore. Average purchase price per policy: Rs11.4 lakh. Monthly pension at Rs11.4L investment: Rs7,030/month.
- Ministry of Finance, FY 2025-26: PMVVY rate: 7.4% per annum. Monthly pension for maximum investment (Rs15L): Rs9,250/month. Scheme available until March 31, 2026 (verify current extension status with LIC or licindia.in — the scheme has been extended multiple times).
- LIC Claims, FY 2024-25: Death claims under PMVVY (purchase price returned to nominee): 28,400 policies. Average claim settlement time: 32 days. All claims fully settled — purchase price returned 100% to nominees.
- LIC Online PMVVY, 2025: Policies bought online: 38% of all new PMVVY purchases. Senior citizens above 70 still predominantly buy at LIC branch with family assistance. Online channel growing as digital adoption among 60-70 age group increases.
1. PMVVY Basics — Rate, Term, Pension Options
| Feature | Detail |
|---|---|
| Interest rate / pension rate | 7.4% per annum |
| Policy term | 10 years |
| Eligible age | 60 years and above |
| Minimum investment | Rs1,62,162 (for Rs1,000/month pension) |
| Maximum investment | Rs15,00,000 per senior citizen |
| Return of purchase price | Full amount returned to nominee on death or policyholder at maturity |
| Pension modes | Monthly, quarterly, half-yearly, or yearly |
| Operated by | LIC of India (Government of India’s appointed operator) |
| Safety | Sovereign — Government of India backed |
2. Pension Payout Table
| Investment Amount | Monthly Pension | Quarterly Pension | Annual Pension |
|---|---|---|---|
| Rs3,00,000 | Rs1,850 | Rs5,564 | Rs22,200 |
| Rs5,00,000 | Rs3,083 | Rs9,273 | Rs37,000 |
| Rs9,00,000 | Rs5,550 | Rs16,694 | Rs66,600 |
| Rs15,00,000 (maximum) | Rs9,250 | Rs27,832 | Rs1,11,000 |
| Rs30,00,000 (couple, Rs15L each) | Rs18,500 combined | Rs55,664 combined | Rs2,22,000 combined |
3. PMVVY vs SCSS vs POMIS — Which to Choose
| Factor | SCSS | PMVVY | POMIS |
|---|---|---|---|
| Rate | 8.2% | 7.4% | 7.4% |
| Monthly pension (Rs15L) | Rs10,250 | Rs9,250 | Rs9,250 |
| Maximum per person | Rs30L | Rs15L | Rs9L single / Rs15L joint |
| Tenure | 5yr (extendable 3yr) | 10yr (fixed) | 5yr (extendable) |
| Minimum age | 60 years | 60 years | No minimum age |
| Premature exit | After 1yr (1% penalty) | After 3yr (2% penalty) | After 1yr (2% penalty) |
| Purchase price return | Full (on maturity) | Full (on maturity or death) | Full (on maturity) |
| Where available | Post office + banks | LIC only | Post office |
Priority order for senior citizens: (1) Max out SCSS first (Rs30L per person at 8.2%). (2) Add POMIS for monthly income (Rs9L single / Rs15L joint at 7.4%). (3) Consider PMVVY only if: SCSS limit exhausted AND you want a 10-year fixed income commitment. PMVVY’s 10-year lock-in is a downside, not a feature, for most seniors who prefer SCSS’s shorter, more flexible tenure.
4. How to Buy PMVVY in 2026
Online: licindia.in → Products → Pension Plans → PMVVY → Buy Online → complete form → upload Aadhaar, PAN, bank details → pay via net banking. Policy document in 3-7 days. Offline: LIC branch with demand draft for purchase amount + Aadhaar + PAN + bank passbook copy + age proof. Pension credited: automatically to registered bank account at each pension period. Verify scheme availability: PMVVY has been extended multiple times. Check current availability at licindia.in before visiting branch — the scheme window may have changed since this guide was updated.
5. Death Benefit and Nomination
On death of pensioner during 10-year term: full purchase price returned to nominee. Nominee does NOT receive the remaining pension instalments — only the lump sum principal back. This protects the family’s capital entirely. Nominee registration: mandatory at time of purchase. Change of nominee: possible by written application to LIC branch. Joint life option: PMVVY also available as joint life policy (pensioner + spouse) — pension continues to the survivor in case of one person’s death. Consider joint policy if ensuring income stream for surviving spouse is the priority.
6. Surrender and Loan Options
| Action | Eligibility | Value Received |
|---|---|---|
| Surrender (general) | After 3 years | 98% of purchase price |
| Surrender (critical illness) | Any time after 1 year | 98% of purchase price |
| Loan against PMVVY | After 3 policy years | Up to 75% of purchase price at LIC loan rate |
| Maturity (10 years) | At 10-year completion | 100% purchase price + last pension |
7. Tax Treatment of PMVVY
PMVVY pension received: fully taxable as ‘Income from Other Sources’ at slab rate. No TDS by LIC on PMVVY pension. Self-declare in ITR. Section 80TTB: senior citizens (60+) get Rs50,000 deduction on interest income from banks and post offices — PMVVY pension from LIC does NOT qualify for 80TTB (80TTB is specific to banking/postal deposits, not LIC insurance). The 80TTB advantage applies to SCSS and POMIS but NOT to PMVVY — another reason SCSS is more tax-efficient. At maturity: return of purchase price is not taxable (capital, not income).
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Frequently Asked Questions
Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a government-backed pension scheme specifically for senior citizens (60+) operated by LIC (Life Insurance Corporation of India). PMVVY provides assured pension for 10 years from the investment date. Current PMVVY rate (FY 2025-26): 7.4% per annum (same as POMIS). Pension payout options: monthly, quarterly, half-yearly, or yearly. Monthly pension at maximum investment: Rs9,250/month (at Rs15L investment). Maximum investment: Rs15 lakh per senior citizen. Rs30L for a couple (Rs15L each). Minimum investment: Rs1,62,162 (for Rs1,000/month pension). Policy term: 10 years. Issued by: LIC of India (the government’s appointed operator). Safety: backed by Government of India — sovereign security. Surrender: allowed after 3 years in case of critical illness (70% of purchase price returned).
PMVVY vs SCSS comparison for senior citizens: Rate: SCSS 8.2% vs PMVVY 7.4% — SCSS is 0.8% higher. Maximum investment: SCSS Rs30L per person (Rs60L for couple) vs PMVVY Rs15L per person (Rs30L couple) — SCSS allows more. Tenure: SCSS 5 years (extendable 3 more) vs PMVVY 10 years. Tax: both — interest fully taxable at slab; 80TTB deduction (Rs50K) available for senior citizens on both. Safety: both government-guaranteed. Liquidity: SCSS allows premature closure after 1 year (1% penalty); PMVVY allows exit after 3 years (30% penalty effectively) — SCSS is more liquid. Verdict: SCSS is clearly superior to PMVVY: higher rate (8.2% vs 7.4%), higher investment limit, better liquidity. PMVVY should only be chosen if you specifically want a 10-year locked income stream and SCSS limit is already exhausted. For most senior citizens: maximise SCSS first, then POMIS, then PMVVY if additional income needed.
PMVVY can be purchased online through LIC’s website (licindia.in) or offline at any LIC branch. Online process: (1) Visit licindia.in → Products → Pension Plans → PMVVY (plan 856). (2) Click Buy Online → fill in proposal form with personal details, investment amount, pension option (monthly/quarterly/etc.). (3) Upload documents: Aadhaar, PAN, age proof, bank account details. (4) Pay purchase price online via net banking, debit card, or NEFT. (5) Policy document issued digitally within 3-7 days. (6) First pension arrives at the end of the chosen payout period (month/quarter/etc.) from the policy commencement date. Offline: visit LIC branch with documents and demand draft for the purchase price. LIC agent can also assist with purchase at home for senior citizens with mobility issues. Both channels are equally valid. Document requirements: age proof (Aadhaar), identity proof, PAN, address proof, bank account details for pension credit.
Death benefit under PMVVY: if the policyholder (senior citizen) dies during the 10-year policy term, the full purchase price (the amount invested, e.g., Rs15 lakh) is returned to the nominee. The nominee does NOT receive the remaining period’s pension — only the lump sum purchase price back. This is an important design: PMVVY is not a traditional life insurance product where the beneficiary receives a death benefit above investment. The investment is fully returned, ensuring the family does not lose the principal even if the pensioner dies early in the policy term. Nomination: designate nominee at the time of purchase. Claim process: nominee submits death certificate, policy document, and their own identity proof to LIC. LIC processes refund within 30-60 days typically. Tax on death benefit: purchase price returned to nominee is not taxable (return of capital, not income).
PMVVY surrender (early exit) rules: Surrender before 3 years: generally NOT allowed except in extreme circumstances (critical illness of self or spouse — documented). Surrender after 3 years: allowed. Surrender value = 98% of purchase price (2% penalty for early surrender). Example: Rs15L invested, surrender after 3 years: get back Rs14,70,000. The 2% penalty = Rs30,000 loss. Additionally: you’ve earned 3 years of pension income which you keep. Net result: pension received for 3 years + 98% principal back. Compare to keeping until maturity (10 years): full Rs15L returned + 10 years of pension. Clearly better to hold to maturity if possible. Loan against PMVVY: yes — LIC offers loans up to 75% of purchase price after 3 policy years. Provides liquidity without surrendering the pension income. The loan option is the preferred route for senior citizens who need emergency cash rather than surrendering the PMVVY policy.