Post Offices across India offer multiple savings schemes, some of which offer high interest to the customers. They are Post office Monthly Income Scheme Account, 5-Year Post Office Recurring Deposit Account, Senior Citizen Savings Scheme, 15 year Public Provident Fund Account, and Sukanya Samriddhi Accounts. These savings schemes are listed on India Post’s website, indiapost.gov.in. So, if you are planning to invest in any of these savings schemes, here is all you need to know about the aforementioned schemes.
– Post Office Monthly Income Scheme Account (MIS):
MIS requires investment in multiples of Rs 1,500. The maximum investment limit for the account is Rs 4.5 lakh in a single account and Rs 9 lakh into a joint account.
Interest rate:
The account offers 7.3 per cent per annum interest rate which is payable monthly. The deposited amount can be prematurely withdrawn after one year but before three years at a 2 per cent discount of the deposit and after 3 years at the discount of 1% of the deposit. (Discount means a deduction from the deposit).
A bonus of 5% on principal amount is admissible on maturity in respect of MIS accounts opened on or after 8.12.07 and up to 30.11.2011. No bonus is payable on the deposits made on or after 1.12.2011.
– 5-Year Post Office Recurring Deposit Account (RD):
A minimum of Rs 10 per month or any amount in multiples of Rs 5 has to be deposited to open an account. However, there is no maximum limit to deposition. On maturity, a Rs 10 account fetches Rs 717.43. The account can be continued for another five years on year to year basis
Interest rate:
The account offers 6.9 per cent of per annum interest rate. A subsequent deposit can be made up to the 15th day of next month if an account is opened up to 15th of a calendar month and up to last working day of next month if an account is opened between the 16th day and last working day of a calendar month.
If subsequent deposit is not made up to the prescribed day, a default fee is charged for each default. Default fee at Rs 0.05 for every Rs 5 shall be charged.
After 4 regular defaults, the account becomes discontinued and can be revived in two months but if the same is not revived within this period, no further deposit can be made.
– Senior Citizen Savings Scheme (SCSS):
An individual of the age of 55 years or more but less than 60 years who has retired on superannuation or under VRS can also open an account subject to the condition that the account is opened within one month of receipt of retirement benefits and the amount should not exceed the amount of retirement benefits.
There shall be only one deposit in the account in multiple of Rs 1000 maximum not exceeding Rs 15 lakh. The maturity period is five years.
Premature closure is allowed after one year on deduction of an amount equivalent to 1.5 per cent of the deposit and after two years, on deduction of 1 per cent of the deposit.
Interest rate:
The account offers 8.3 per cent interest rate per annum which is payable from the date of deposit of March 31/ September 30/ December 31 in the first instance and thereafter, interest shall be payable on March 31, June 30, September 30 and December 31.
– 15 year Public Provident Fund Account (PPF):
An individual needs to deposit a minimum of Rs 500 and a maximum of Rs 1,50,000 in a financial year. Deposits can be made in a lump-sum or in 12 instalments.
Maturity period is 15 years, but the same can be extended within one year of maturity for a further five years and so on. The account does not allow a premature closure before 15 years. The deposits qualify for deduction from income under Section 80C of the IT Act.
Interest Rate:
PPF accounts offer an interest rate of 7.6 per cent per annum (compounded yearly) currently. The interest is completely tax free.
– Sukanya Samriddhi Accounts:
A legal guardian/natural guardian can open this account in the name of a girl child. Sukanya Samriddhi Accounts require a minimum deposit of Rs. 1,000 and a maximum of Rs. 1,50,000 in a financial year. Subsequent deposits can be made in multiples of Rs. 100. Deposits can also be made in lump-sum.
Partial withdrawal, maximum up to 50 per cent of the balance standing at the end of the preceding financial year, can be taken after the account holder’s attaining age of 18 years. The account can be closed after completion of 21 years.
Interest rate:
Sukanya Samriddhi Accounts offer interest rate of 8.1 per cent per annum (with effect from 1.01.-2018), which is calculated on a yearly basis and is compounded yearly.
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