From Savings Account To Recurring Deposit: Know All About Your Investment Options At The Post Office
Did you know you can access a variety of banking services at a post office? Other than mailing services, India Post - which operates a network of more than 1.5 lakh post offices across the country, provides a variety of banking services. One can carry out a number of banking-related tasks at a post office: from setting up a savings account under Government of India's small savings schemes to a National Pension System or NPS account (all citizens model), which is a voluntary pension scheme managed by the PFRDA or Pension Fund Regulatory and Development Authority.Â
While an interest rate of 4 per cent is applicable on the deposit in the savings account, investment in the other savings schemes at the post office fetches interest at the rates to the tune of 7 per cent to 8.7 per cent, according to India Post's website - indiapost.gov.in.
Post office savings scheme lock-in period
The savings schemes of Time Deposit, Recurring Deposit, Monthly Income, Senior Citizens, PPF, NSC and Kisan Vikas Patra come with a lock-in period - also known as maturity period - of one year to 15 years, according to the India Post website.
Here are some of the banking services offered by the post office (India Post):
India Post small savings schemes
One can set up a variety of bank accounts at the post office. These include a savings account, a time deposit or fixed deposit (FD) account, a recurring deposit (RD) Â account, a Sukanya Samriddhi account and a Public Provident Fund (PPF) account. The post office also offers certificate investment schemes such as Kisan Vikas Patra and National Savings Certificate (NSC).
Here are the interest rates applicable to the nine small savings schemes for the quarter ending June 30:
| Savings scheme | Interest rate | Maturity period | Investment limit |
|---|---|---|---|
| Post Office Savings Account | 4% | - | Minimum Rs 20 for opening account |
| National Savings Recurring Deposit Account | 7.30% | 5 years | Minimum Rs 10 per month, no maximum limit |
| National Savings Time Deposit Account | 7-7.8% | 1/2/3/5 years | Minimum Rs 200, no maximum limit |
| National Savings Monthly Income Account | 7.30% | 5 years | Rs 1,500 - Rs 4.5 lakh in single account/Rs 9 lakh in joint account |
| Senior Citizens Savings Scheme | 8.70% | 5 years | Rs 1,000 - Rs 15 lakh |
| Public Provident Fund | 8% | 15 years | Rs 500 - Rs 1.5 lakh per financial year |
| National Savings Certificates | 8% | 5 years | Minimum Rs 100, no maximum limit |
| Kisan Vikas Patra | 7.70% | 2.5 years | Minimum Rs 1,000, no maximum limit |
| Sukanya Samriddhi | 8.50% | - | Rs 1,000 - Rs 1.5 lakh per financial year |
| (Source: indiapost.gov.in) | |||
Post office savings schemes income tax benefits
Investment in three of these small savings schemes offered by the post office is eligible for a deduction in taxable individual income up to Rs. 1.5 lakh in a financial year under Section 80C of the Income Tax Act. These post office schemes are: National Savings Time Deposit (five years), Public Provident Fund (15-year) and Senior Citizen Savings Scheme.
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