Post Office Savings Scheme

Savings Schemes under Post Office Investments

The table mentioned below lists the best investment options under the Post Office Saving Scheme: 

*The interest rates of Post Office Savings Scheme are quarterly reviewed by the Government of India.

Post Office Saving Schemes in Detail

1. Post Office Time Deposit Scheme

   This scheme under the Post Office Savings Scheme offers various tenures for this investment option. The current rate as per the tenure is mentioned in the table below:

   Tenure	Rate of Interest (Jan - March 2023)
   One Year	6.9%
   Two Years	7.0%
   Three Years	7.0%
   Five Years	7.5%

   • Minimum investment in this scheme is Rs. 1000

   • No upper limit of investment

   • You can open any number of accounts under this scheme.

   • Transfer of account from one post office to another is allowed

   • Facility of both single and joint account is available under post office time deposit scheme

   • Automatic renewal of the same tenure as soon as the time deposit matures

   • Tax benefits are available for investments made for 5-Year Time Deposits under Section 80C of the Income Tax Act.

2. Post Office Recurring Deposit

   Under the Post Office Savings Scheme, PO Recurring Deposit has the following features: 

   • Monthly savings scheme for a period of five years

   • Both Single and Joint accounts available

   • Provides interest at 6.7% per annum, which is compounded quarterly

   • Minimum deposit for the Post Office Recurring Deposit Scheme is Rs.100 per month and in multiples of Rs. 10, thereafter.

   • No upper limit for deposits in Post Office RD Scheme

   • You can open multiple accounts in this scheme

   • If a subsequent deposit is not made, Rs. 1 charged on every Rs.100 denomination account

   • After 1 year, you can avail loan facility of up to 50% on the Post Office RDs.

   • No TDS is deducted on interest earned from the Post Office Recurring Deposit Scheme. However, interest is taxable as per your tax slabs under the Income Tax Act, 1961.

3. Post Office Savings Account

   The key features of Post Office Savings Account are as follows: 

   • The account works in the same way as the savings accounts of banks.

   • Interest rate is 4% per annum. 

   • Minimum deposit amount of Rs. 500 required.

   • Subsequent deposits should not be less than Rs. 10.

   • Only one account can be opened with one post office.

   • Accounts can be transferred from one post office to another.

   • Interest is completely taxable with no TDS deduction.

4. Post Office Monthly Income Scheme Account (PO - MIS)

   Following are the key features MIS under the Post Office Savings Scheme:

   • Unique scheme that provides you with fixed income per month for investing in POMIS scheme. 

   • Both individual and joint accounts are available

   • Minimum deposit of Rs. 1000 is required under Post Office Monthly Income Scheme Account. 

   • Maximum deposit of Rs. 9 lakhs for single account and Rs. 15 lakhs for joint account.

   • Interest rate of 7.4% per annum with a 5-year maturity period.

   • Accounts for minors can be opened with the ability to operate if they are above 10 years of age.

   • The monthly interest is taxable, but no TDS is deducted on interest

5. Public Provident Fund (PPF)

   Public Provident Fund scheme has the following features:

   • PPF is a long-term investment plan with a 15-year investment period.

   • Only individual account can be opened

   • It offers an interest rate of 7.1% per annum compounded yearly.

   • Minimum investment required is Rs. 500, maximum is Rs 1.5 lakhs per financial year.

   • Investment can be made in a lump sum or in periodic instalments

   • Maturity period is 15 years and can be extended indefinitely, in blocks of five years.

   • Premature closure facility is available after completion of 5 years for higher education or serious ailments.

   • Partial withdrawals are allowed after the completion of 5 years.

   • Loan facility available against PPF from the 3rd and 6th year of account opening.

   • PPF investments are eligible for tax exemption under Section 80C of the Income Tax Act.

   • Interest on the PPF balance is tax-free but must be declared in ITR.

6. Senior Citizen Savings Scheme (SCSS)

   This scheme under the Post Office Savings Scheme has the following features:

   • Minimum age to opt for this Post Office Senior Citizen Saving Scheme is 60 years.

   • Retired defence personnel can open the SCSS account after 50 years of age.

   • The entry age is 55 years on voluntary retirement

   • Investment amount should not exceed the retirement corpus value.

   • Joint account can be opened with a spouse. 

   • You can hold more than one SCSS account.

   • Minimum investment amount is Rs. 1000.

   • Maximum investment limit is Rs. 30 lakhs per individual.

   • Currently, the interest rate is 8.2% per annum, payable quarterly.

   • Maturity period is 5 years, which can be extended in a block of 3 years.

   • Premature withdrawal is allowed after 1 year with a 1.5% penalty.

   • Penalty of 1% applied after completion of 2 years.

   • Investments can get tax exemption under Section 80C of Income Tax Act 1961.

7. National Saving Certificate (NSC)

   National Savings Certificate offers the following structure: 

   • The Maturity period of the Post Office Saving Scheme is 5 years.

   • Minimum investment amount is Rs. 1000 and there is no upper limit.

   • Rate of interest is 7.7% per annum, compounded annually but payable at maturity only.

   • NSC certificates can be purchased for self or on behalf of a minor.

   • Both Single Account and Joint Account (up to 3 adults) are available

   • Investment is eligible for tax deduction under Section 80C of the Income Tax Act. 

   • NSC can be transferred once from one person to another during the tenure of investment.

   • You can avail of loans against your NSC certificates.

8. Sukanya Samriddhi Yojana (SSY)

   This scheme under the Post Office Savings Scheme has the following features:

   • Post Office Saving Scheme is for the education and upliftment of a girl child.

   • The interest rate is 8.0%, which is compounded yearly.

   • Minimum investment: Rs.250, Maximum: Rs.1,50,000 per financial year.

   • Regular investment for 15 years required in Sukanya Samriddhi Accounts

   • Matures after 21 years from opening or on child's marriage after 18 years.

   • Eligible for tax exemption under Section 80C of Income Tax Act (up to Rs 1.50 Lakh per year).

   • Interest and maturity amount is tax-free.

9. Kisan Vikas Patra (KVP)

   Kisan Vikas Patra is one of the Post Office Savings Schemes offering the following features: 

   • Kisan Vikas Patra earns 7.5% interest per annum, which is compounded annually.

   • Available for purchase at any Post Office.

   • Investment amount doubles after 120 months (10 years).

   • Minimum investment amount is Rs. 1000, with no upper limit.

   • It can easily be transferred.

   • Encashment facility is available after 2.5 years of investment.

   • KVP certificates are transferable and you can endorse them to a 3rd party.

   • No tax deduction on the invested amount in the Kisan Vikas Patra.

   • The interest earned is taxable under the IT Act, 1961.

Who Can Invest in a Post Office Savings Scheme?

Almost all the citizens in India are eligible to invest in the Post Office scheme for savings. Let us learn the eligibility below:

1. General Eligibility:

   • Adults: Both individual and joint accounts are available.

   • Minors: Guardians can open accounts on their behalf.

   • Non-Resident Indians (NRIs): Cannot invest in most schemes, except for Public Provident Fund (PPF) and Sukanya Samriddhi Account (SSA) under specific conditions.

2. Specific Schemes:

   • Senior Citizen Savings Scheme (SCSS): Only for individuals aged 60 and above.

   • Sukanya Samriddhi Account (SSA): Only for girl children below 10 years of age.

   • Kisan Vikas Patra (KVP): No specific age restriction

How to Apply for a Post Office Savings Scheme?

Now let us take you through the following simple steps to apply for any of the post office savings scheme:

• Step 1: Visit the preferred branch of the post office.

• Step 2: Now, get the account opening form of the preferred post office savings scheme in which you wish to invest. You can also download the forms from the official website of the Indian post.

• Step 3: Fill up the form with all correct information and then submit it with the KYC evidence and other documents including the photograph as per the requirement of the post office savings scheme.

• Step 4: Now, simply complete the enrolment by depositing the sum as per the selected post office savings scheme. 

Documents Required for Post Office Saving Schemes

• Application Form (specific to the scheme)

• Voter’s ID card

• Job card 

• Proof of date of birth

• KYC Form

• Aadhaar

• Driving license

• PAN

Benefits of Investing in Post Office Savings Scheme

• Easy Enrolment Process: In order to start investing in one of the Post Office Saving Schemes, there is very limited documentation required. 

• Simple to Invest: Post Office Saving Schemes are easy to enrol and invest. This is the reason they are best suited for both urban and rural investors.

• Invest Money for Long Term: Most of the Post Office Savings Schemes are long-term schemes that give an opportunity to save for long term goals. For example, the investment period of the PPF scheme is 15 years.

• Different Schemes to Cater to the Requirements of All: Post Office Saving Scheme contain a variety of schemes so that you can purchase according to your requirements.

• Good Interest Rate: The interest amount of all the schemes under Post Office Saving Scheme falls under the range of 4% to 8.2% p.a., which is considered as good.

• Risk-Free Investment: Post Office Saving Schemes are government schemes that makes them completely risk-free. 

• Tax Exemption: Most of the Post Office Saving Schemes provide tax benefits under Section 80C of the Income Tax Act 1961 on your investment amount. Some schemes such as SCSS, Sukanya Samriddhi Yojana, PPF, etc. as well provide tax exemption over the maturity amount.

Final Words

Post Office Savings Schemes provide a reliable and secure way for you to save your money and earn interest on your savings. With a wide range of options, you can choose the best-suitable scheme as per your future financial needs and goals.