The RGESS scheme was proposed in the Union Budget 2012-13, to encourage flow of savings in the financial instruments and improve the depth of domestic capital market.

Features of the Scheme:

  1. Designed exclusively for the first time retail investors in securities market, whose gross total income for the year is less than or equal to Rs. 10 lakh.
  2. The investor would get under Section 80CCG of the Income Tax Act, a 50% deduction of the amount so invested, upto a maximum investment of Rs.50,000, from his/her taxable income for that year.

Eligibility :

The Scheme is open for all New Retail Investors who have gross total income less than or equal to Rs. 10 lakh. A new  retail investor is one:

  1. Who is a resident individual (the benefit cannot be availed corporate entities / trusts etc)
  2. Who has not opened a Demat account and has also not done any trading in the derivative segment till RGESS account opening date.
  3. Those who have opened the Demat account and have not made any any transactions in equity and/ or in the derivative segment till designating such account as RGESS.

Eligible Securities:

The individual can invest in any of these eligible securities :

  1. Equity shares of selected companies which include:
    1. Companies falling in the list of 'CNX-100' of NSE or 'BSE-100'.
    2. Public sector enterprises categorized as Maharatna, Navratna or Mini-ratna by the Central Government.
  1. Units of Mutual Fund (MF) schemes which are RGESS compliant.
  2. Units of Exchange Traded Funds (ETFs) which are RGESS compliant.
  3. IPOs /NFOs of above mentioned companies/funds. IPO of PSUs with annual turnover greater than Rs.4000 cr. consistently for past years.

Process of availing for RGESS facility:

  1. Client can opt for this scheme by submitting Form A at any of Saraswat Bank branch at the time of opening the Demat account.
  2. On receiving the Form, Saraswat Bank will validate the eligibility basis i.e. PAN card of the first holder updated in the demat account.
  3. If the investor is eligible for RGESS scheme as per SEBI guidelines, Saraswat Bank will sent the Client Master List.
  4. The client can then invest in RGESS eligible securities with a maximum limit of Rs. 50,000/- to claim the tax benefit, which will be automatically locked in his Demat account.
  5. If the client does not wish a certain set of eligible securities to be locked under RGESS, he / she can submit a Form B within 30 days of such investment.
  6. In case the client wishes to sell part of securities during the flexible lock-in period (after the first year) however the value of securities sold should be replenished with equivalent value of other securities as defined under RGESS


As per SEBI guidelines deduction claimed shall be withdrawn if the lock–in period requirements of the investments are no complied with or any other condition of the scheme is violated.