Post Office Savings Account Interest Rate 2023

Post offices have come up with many schemes and policies for their customers over the years and have generated trust amongst all because it is completely government-backed. One of the most renowned savings accounts in India is believed to be the Post Office Savings account.

From tax-saving benefits to great interest rates, post office savings schemes are highly-beneficial for the scheme-holders.

Key Features of Post Office Savings Account

• The account holder is permitted to close the account at any time as per their convenience.

• Minors above the age of 10 are allowed to operate post office savings account. 

• In order to keep your post office savings account active, you are required to transact in the account once in 3 years. You can do so by either depositing or withdrawing the amount. 

• One is required to open the account only by doing a cash deposit.

• Post office savings account provides nomination facility both at the time of opening the account and after opening the account.

• Maximum ₹10,000 interest earned within a financial year is tax-free as per the Income Tax act 80TTA.

• The account holder is allowed to transfer their savings account from one branch of the post office to another.

• As per the convenience of account holders, the joint accounts can be converted into single accounts and vice versa.

• Once you open the account, you can make further deposits and withdrawals via electronic modes in CBS post offices.

• You can also make the transactions via any ATM machines available near you.

Eligibility to Open Post Office Savings Account

• Minors above the age of 10. 

• A biological or legal guardian on behalf of a minor or unsound kid.

• An individual with an unsound mind.

• To open a joint account, 2 or 3 adults. 

• Security Deposit Account, Institutional Accounts, Official Capacity Accounts, Group Accounts, are not sanctioned.

Documents Required to Open a Post Office Savings Account

You are required to submit a maximum of 2 passport-size photographs of yourself. Apart from that, you are required to provide identity proof and address proof. You can present the following documents for identity proof and address proof:

1. ID Proof

   • Voter ID Card

   • Ration Card

   • Passport

   • Driving License

   • Photo ID Card from a recognized educational institute

   • Aadhaar Card

2. Address Proof

   The documents provided for address proof must have the present address mentioned on them.

   • Bank or Post Office Passbook

   • Passport

   • Ration Card

   • 3 months old electricity or telephone bills or any utility bill

   • Salary Slip from a reputed Employer

   • Certificate from any Public Authority

   • Aadhaar Card

Post Office Savings Account Benefits

1. Cheque facility

   A cheque facility is available. Also, it can be requested for existing accounts. 

2. ATM/Debit card

   If you have maintained the minimum balance in the post office savings account since the beginning of the account till the time of issuance of debit card, you are permitted to request to ATM/debit card from the post office officials.

3. Minor Accounts

   Children above 10 years of age are allowed to open the post office savings account in their own name. Whereas for minors below the age of 10 years, a parent or legal guardian is required to open and operate the account on their behalf

4. Account Transfer

   If you shift your residence or are not satisfied with the services of the post office branch or for any other reason, you can transfer your savings account from the existing post Office Savings Account branch to the branch of your choice. Also, only one account is allowed to open in one post office branch.

5. Nomination

   You are allowed to nominate someone at the time of opening the account or after the account is opened. You can nominate the person to receive/withdraw the money from this account after your demise.

6. Joint Accounts

   2 to 3 adults are permitted to open and operate the post office savings account together under the joint account facility. Also, you can convert the joint account into a single account and vice versa. 

7. Tax Exemptions

   You can enjoy tax exemption on the interest earned in the savings account for up to ₹10,000 in the first financial year. Exemption of tax is available as per the scheme chosen by the individual for investment.

8. Electronic Facilities

   Customers can do transactions via any electronic mode in Post offices.

9. Long period for Inactivity

   In order to keep the account active, you are required to make a transaction in your account only once in 3 years. If you will miss making even a single transaction (deposit or withdraw) the account for 3 years, your account will be deemed inactive.

The Process to Apply for Savings Scheme in Post Office

These simple steps need to be followed to apply for Savings Scheme in Post Office:

• Visit the nearest post office branch or head office.

• Request for the desired form. An individual willing to buy any post office scheme can also download the necessary forms from the official website of the Indian post office.

• Fill the complete form with all the correct information and required documents.

• The enrollment process will be completed once the form is approved and the minimum payment is received by the post office officials.

Advantages of Investments in Post Office Savings Schemes

As all the schemes under the post office savings schemes are government-backed, hence:

• There is a simple investing process involved

• It is easily accessible to all the Indians

• It has long-term benefits

• There are minimal or no risks involved

• Customization is available as per the individuals’ requirement