Post Office Monthly Income Scheme for NRI – POMIS Interest Rate 2024

Post Office Monthly Income Scheme is a government-backed investment option that provides you with reliable and fixed monthly income payouts. Non-Resident Indians (NRI) can not invest directly in this scheme. The scheme offers a 7.4% p.a. POMIS interest rate till 31st March 2024.

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What is a Post Office Monthly Income Scheme (POMIS) for NRI?

The Post Office Monthly Income Scheme (POMIS) is a savings and investment plan offered by the Indian Post Office. Currently, the scheme offers a fixed interest rate of 7.4% p.a. You can invest a fixed amount in this pension plan, and in return, you receive a periodic monthly income on completion of 5 years. It provides a stable and secure investment option for NRIs looking for safe and regular returns.

What are the Features of POMIS?

The Post Office Monthly Income Scheme (PO – MIS) offers the following key features:

Feature Details
Lock-in Period The invested amount in a Monthly Income Scheme account with a post office is locked for 5 years.
Maximum Limit Rs. 9 Lakhs for a single account. An aggregate of all deposits across multiple post offices cannot exceed Rs. 9 Lakhs.
Joint Account A joint account with 2 or 3 individuals allows an aggregate investment of up to Rs. 15 Lakhs. Each investor has equal rights.
Transferable You can transfer your POMIS account to a different post office within India if you change your residential status. Corpus and interest move with the transfer.
Minor Account A POMIS minor account can be opened for a child above 10 years. Withdrawal is possible after maturity at 18 years.
Eligible Residence Indian citizens are eligible, but NRIs cannot open a POMIS account directly.
Auto-withdrawal Monthly interest can be automatically transferred to your savings account through PDCs or ECS. Applicable to CBS Post Offices for directing to any CBS-centric savings account.
Penalty for Withdrawal Early withdrawal incurs a penalty based on the time of redemption during the lock-in period.
Investment Amount Minimum Rs. 1000, and multiples of Rs. 1000.
Tax Benefits No Tax Deducted at Source (TDS) on interest. However, it does not qualify for tax benefits under Section 80C.

Maximum Investment Limit for Post Office Monthly Income Scheme (POMIS)

You can invest in the PO – MIS scheme as per the following investment limits:

Account Type Maximum Limit
Single Account Rs. 9 Lakhs
Joint Account Rs. 15 Lakhs

POMIS Interest Rate

The current interest rate for the Post Office Monthly Income Scheme (POMIS) as of January 1, 2024, is 7.40% per annum, payable monthly. This is a good rate compared to other fixed-income investments, such as bank savings accounts and fixed deposits.

Benefits of POMIS

The key benefits of the Post Office Monthly Income Scheme (POMIS) are listed below:

benefits of pomisbenefits of pomis

  • Steady Monthly Income: Provides a fixed monthly income, ensuring financial stability.

  • Government Backing: POMIS is backed by the Indian government, adding credibility to the investment.

  • No Market Risk: Unlike investments in stocks or mutual funds, POMIS does not expose you to market fluctuations.

  • Reliable Returns: Offers a predetermined interest rate, ensuring a reliable and predictable return.

  • Low Minimum Investment: Allows investors to start with a relatively low amount.

Eligibility Criteria for PO – MIS

  • Residency Requirement: Only resident Indians can open a POMIS account; it is not applicable to Non-Resident Indians (NRIs).

  • Age Criteria: Individuals above 18 years can open their own accounts.

  • Minor Accounts: Accounts for minors (aged 10 and above) can be opened by someone on their behalf. At 18, minors gain access to the funds.

  • Conversion at Majority: Once a minor reaches the age of majority, they need to apply to convert the account into their name.

Documents Required for PO – MIS

The following documents are required to apply for the Post Office Monthly Income Scheme (POMIS) in India:

  • Identity Proof: Aadhaar card, PAN card, voter ID card, or other government-issued ID.

  • Address Proof: Utility bills, bank statements, or other documents reflecting the resident's address in India.

  • Two Passport-Sized Photographs

Comparison Between
Fixed Deposits, Guaranteed Return Plans & Debt Mutual Fund
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Debt Mutual Fund
Guaranteed Return Plans
Returns Before Tax
7.5% (TAX-FREE)
Returns After Tax
7.5%
Guaranteed Returns
Yes
Life Cover
Yes
Tax on Profit
Tax Free*
Risk
No Risk
awards
Still Better than FD’s and Debt Mutual Fund
Fixed Deposits
Returns Before Tax
7% (TAXABLE)
Returns After Tax
4.8%
Guaranteed Returns
Yes
Life Cover
No
Tax on Profit
Taxable
Risk
Low Risk
Debt Mutual Fund
Returns Before Tax
8% (TAXABLE)
Returns After Tax
5.5%
Guaranteed Returns
No
Life Cover
No
Tax on Profit
Taxable
Risk
High Risk
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Post Office Monthly Income Scheme Interest Rate History

Period Post Office MIS Interest Rate (Annual)
1st April 2023 – 31st March 2024 7.40%
1st January 2023 - 31st March 2023 7.10%
1st October 2022 - 31st December 2022 6.70%
1st July 2022 – 30th September 2022 6.60%
1st April 2022 – 30th June 2022 6.60%
1st April 2021 – 31st December 2021 6.60%
1st April 2018 – 30th June 2018 7.3%
1st January 2018 – 31st March 2018 7.3%
1st October 2017 – 31st December 2017 7.5%
1st July 2017 – 30th September 2017 7.5%
1st April 2017 – 30th June 2017 7.6%

*POMIS Interest rate as of January 2024

Penalty on Early Withdrawal from POMIS Account

Penalty is levied on early withdrawal from Post Office Monthly Income Scheme (POMIS) account as the following rules:

Time Frame Withdrawal Conditions
First Year Withdrawal not permitted during the initial year.
1-3 Years If closed within 1-3 years, a penalty of 2% of the principal will be imposed; the remaining amount transferred.
4-5 Years If closed within 4-5 years, a penalty of 1% of the principal will be imposed; the remaining amount transferred.

Post Office Monthly Income Scheme (POMIS) vs. Monthly Income Plans

Feature POMIS Mutual Fund MIP Insurance MIP
Income Type Guaranteed fixed Variable, depends on market Guaranteed annuity
Investment Focus Debt securities Debt & equity (20:80) Life cover & investment
Returns 7.4% interest p.a. (Jan 2024) Up to 14%, can fall negative Fixed annuity based on premiums
Risk Very low Low to moderate Low (investment risk), medium (life cover risk)
Tax Interest taxable, no TDS Income taxed, no TDS Annuity taxable
Investment Limit Individual: ₹9 lakh, Joint: ₹15 lakh No limit No limit
Lock-in 5 years 1 year exit load Policy term (20-30 years)
Liquidity Premature withdrawal with penalty After 1 year Surrender charges based on policy term
Suitability Risk-averse NRIs seeking steady income NRIs wanting moderate risk & growth NRIs seeking income & life cover

POMIS vs Other Post Office Savings Schemes

Savings Scheme Rate of Interest TDS
Post Office Monthly Income Scheme 7.40% No TDS is deducted
Post Office Recurring Deposit 6.20% No TDS is deducted
Post Office Time Deposit  5.50% No TDS is deducted
Post Office Time Deposit (5 years) 6.70% TDS is deducted
National Savings Certificate 6.80% TDS is deducted
Senior Citizen Saving Scheme 8.20% TDS is deducted
Public Provident Fund 7.10% TDS is deducted

In Conclusion

The Post Office Monthly Income Scheme offers a reliable avenue for resident individuals in India to secure a steady monthly income. With attractive POMIS interest rates and the trustworthiness of the postal system, this scheme presents a viable option for investors seeking a stable and hassle-free investment option.

FAQ's

  • What is the monthly income scheme of POMIS?

    The Post Office Monthly Income Scheme (POMIS) is a government-backed investment scheme offered by the Indian Post Office. It allows you to deposit a lump sum amount and earn a fixed monthly income based on the current interest rate, which is currently 7.4% per annum (as of January 2024). This interest is compounded quarterly and paid out to you every month.
  • What is the monthly interest on 1 lakh in the post office?

    As of January 2024, the monthly interest on Rs. 1 lakh in the Post Office Monthly Income Scheme (POMIS) is approximately Rs. 700. This is calculated based on the current interest rate of 7.4% per annum compounded quarterly.
  • What is the interest rate for MIS in post office 2024?

    The interest rate for the Post Office Monthly Income Scheme (POMIS) in 2024 is as follows:
    Period Post Office MIS Interest Rate (Annual)
    1st April 2023 – 31st March 2024 7.40%
    1st January 2023 - 31st March 2023 7.10%

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^Trad plans with a premium above 5 lakhs would be taxed as per applicable tax slabs post 31st march 2023
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