A Post Office Basic Savings Account is a secured savings option offered by India Post. The IPPB interest rate on the Basic Savings Account varies based on the account balance. It is 2% per annum for balances up to ₹1 lakh and 2.25% per annum for balances above ₹1 lakh and up to ₹2 lakh.
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Generate wealthEarn 1 Cr# in maturity with Zero LTCG tax¶
Double tax savings^On premiums (under 80C) and on maturity (under
10(10D))
A Post Office Basic Savings Account is a government-backed deposit scheme granted under the Post Office Savings Bank (POSB). It provides a secure platform for individuals to deposit funds and perform basic banking transactions. Operated by the Department of Posts, the account serves both rural and urban populations, with a maximum end-of-day balance limit of ₹2,00,000. The interest on a Post Office Savings Account is paid every quarter and is credited in the month after the quarter ends.
Key Features of Post Office Basic Savings Account
The Post Office Basic Savings Account offers various features appealing to investors. Some of these include:
Free Virtual Debit Card: Comes with no charges for issue, reissue, or annual maintenance, making digital banking cost-free.
POSA Account Linkage Facility: You can link your Post Office Basic Savings Account with a Post Office Savings Account (POSA) to automatically transfer any balance above ₹2 lakh at the end of the day. A sweep-in limit of ₹50,000 is applicable for the first three days after successful linkage.
Free Monthly e-Statement: Account holders receive a free monthly e-statement, ensuring easy and paperless tracking of transactions and balances.
Free SMS Alerts: Post Office Basic Savings Account holders receive free SMS alerts for transactions, helping them stay updated at no additional cost.
Cash Withdrawal Charges: Account holders can make up to four cash withdrawals per month free of charge. Beyond this limit, a fee of 0.50% of the transaction amount is applicable, subject to a minimum charge of ₹25 per transaction.
How to Open a Post Office Basic Savings Account?
Opening a post office basic savings account is easy, and it can be availed of either online (if supported in your region) or offline through the nearest post office.
Online Method
Download the IPPB App: Available for both Android and iOS platforms.
Select Savings Account Option: Click on 'Open Savings Account' On the main dashboard.
Complete Your e-KYC: Submit Aadhaar, PAN, and provide OTP or biometric verification.
Submit Details: Enter your contact details and select your preferences, such as whether you prefer a single or joint account.
Account Activation: You will receive a notification, and your mobile banking services will be enabled.
Offline Method
Visit the Nearest Post Office: Go to your local India Post branch.
Collect the Form: Ask for the Savings Bank Account Opening Form.
Fill in Personal Details: Provide your name, address, nominee information, and choose the account type (single or joint).
Submit Documents: Attach Aadhaar, PAN, photographs, and valid address proof.
Receive Passbook: Once your details are verified, your account is activated and the passbook is issued.
Eligibility to Open a Post Office Basic Savings Account
To open a Post Office Basic Savings Account under the Post Office Savings Bank (POSB), individuals must meet the following eligibility criteria:
Minimum Age Requirement: The applicant must be at least 10 years old. Minors aged 10 years and above are allowed to operate the account independently.
KYC Compliance: The individual must complete the Know Your Customer (KYC) formalities by providing valid identity and address proof, such as Aadhaar and PAN.
Joint Account Option: The account can be opened individually or jointly, allowing shared ownership between two or three adults.
Resident Status: Only resident Indian individuals are eligible to open this account. Non-resident Indians (NRIs) are not permitted to hold POSB accounts.
Key Takeaways
The Post Office Basic Savings Account is a simple savings option suitable for individuals across different regions. Post Office Savings Account interest rates, ranging from 2% to 2.25%, are backed by the Government of India and provide basic banking services. The account can be opened either at a post office branch or through the IPPB mobile app by individuals living in urban and rural areas.
FAQs
Is there any minimum deposit required to open a Post Office Basic Savings Account?
No, there is no initial minimum deposit required to open a Post Office Basic Savings Account.
What is the difference between a basic savings account and a regular savings account in IPPB?
Basic savings accounts offer restricted transactions with no charges. On the other hand, a regular IPPB account provides additional functionalities, including cheque books, higher transaction limits, and full digital access.
Which savings account is best in the post office?
The basic savings account is best suited for everyday users. Whereas, individuals intending to save for a longer period might find term deposit-linked accounts or the Monthly Income Scheme more lucrative.
˜The insurers/plans mentioned are arranged in order of highest to lowest first year premium (sum of individual single premium and individual non-single premium) offered by Policybazaar’s insurer partners offering life insurance investment plans on our platform, as per ‘first year premium of life insurers as at 31.03.2025 report’ published by IRDAI. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For complete list of insurers in India refer to the IRDAI website www.irdai.gov.in
Disclaimer: #The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.
Past 10 Years' annualised returns as on 01-10-2025
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
Tax benefit is subject to changes in tax laws. Standard T&C Apply
++Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
**Returns are based on past 10 years’ fund performance data (Fund Data Source: Value Research).
Generate wealth Earn 1 Cr# in maturity with Zero LTCG tax¶
Double tax savings^ On premiums (under 80C) and on maturity (under 10(10D))
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