Post Office Saving Schemes

Post office schemes provide a guaranteed income backed by the Indian government. Moreover, it is designed by the Indian government to meet all the investment needs of all types of people. The investment can be a minimum or maximum amount but the interest rate is same for all.

Also, there are many schemes in the post office which has tax exemption under section 80C, where tax is being exempted till Rs. 1.5 Lakhs.

To know the details about all the post office deposit schemes such as Public Provident Fund (PPF), Sukanya Samriddhi Yojana (SSY), National Savings Certificate (NSC), Kisan Vikas Patra (KVP), National Savings Monthly Income Account (MIS), Senior Citizen Savings Scheme (SCSS) see below

Difference in Post Office Saving Schemes

Post office consists of many investment schemes. Let us see each of the scheme’s duration, eligibility, interest rate, tax exemption, mode of payment of interest, and minimum and maximum investment in brief:

1. Post Office Savings Account:

• Duration: There is no time limit for this savings scheme
• Eligibility: The customer should be an Indian Resident. Minors, below the age of 10 can open this account along with a guardian/parents. Also, Minors above the age of 10 can open with his/her name.
• Interest rate: For a year, 4% is the interest rate.
• Tax: Tax-exemption till the interest earned up to Rs.10,000. No tax exemption under 80C
• Mode of payment of interest: Interest paid once in a financial year.
• Minimum and Maximum Investment: The minimum investment is Rs.500, No Limitation for the maximum investment.

2. National Savings Recurring Deposit:

• Duration: 5 Years.
• Eligibility: Indian citizens can open an account as a single/joint account. Minors, below the age of 10 can open this account along with a guardian/parents. Also, Minors above the age of 10 can open with his/her name.
• Interest rate: Yearly 6.7% is interest rate but compounded quarterly.
• Tax: No Tax-exemption
• Mode of payment of interest: Quarterly.
• Minimum and Maximum Investment: Monthly Rs.100 is the minimum investment, there is no limitation for maximum investment.

3. National Saving Time Deposit:

• Duration: 1, 2, 3, and 5 Years.
• Eligibility: Indian Citizens. Minors, below the age of 10 can open this account along with a guardian/parents. Also, Minors above the age of 10 can open with his/her name.
• Interest rate: Yearly 6.9% for 1 year, 7 % for 2 years, 7% for 3 years, 7.5% for 5 years.
• Tax: Only the investment made for 5 Years gets the tax exemption under 80C, but other investments are subject to tax.
• Mode of payment of interest: Moreover, Interest is paid annually.
• Minimum and Maximum Investment: Can start from Rs.1,000, No limit for maximum investment.

4. National Savings Certificate – NSC:

• Duration: 5 Years.
• Eligibility: Indian citizen.
• Interest rate: Furthermore, Yearly, 7.7% interest rate.
• Tax: Investment is tax-exempt under 80C, but interest is taxable.
• Mode of payment of interest: Compounded Annually but paid at the maturity.
• Minimum and Maximum Investment: Start from Rs. 1,000 but no limitation for maximum investment.

5. Kisan Vikas Patra – KVP:

• Duration: 115 Months.
• Eligibility: Indian Citizens both major and minor.
• Interest Rate: Yearly 7.5% .
• Tax: No tax exemption but Interest is subject to tax.
• Mode of payment of interest: Hence, compounded Annually.
• Minimum and Maximum Investment: Start from Rs. 1,000 but no limitation for maximum investment.

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6. Public Provident Fund – PPF:

• Duration: 15 Years (5 Years can be extended).
• Eligibility: Indian Citizens.
• Interest Rate: 7.1%.
• Tax: EEE (Exempt-Exempt-Exempt) under the exemption. Also, Deposit, interest, and maturity amounts are under the tax-exemption.
• Mode of payment of interest: Hence, compounded Annually.
• Minimum and Maximum Investment: From Rs.500 to Rs.1.5 Lakhs.

7. Sukanya Samriddhi Yojana – SSY:

• Duration: 21 Years or before the date of marriage.
• Eligibility: Obviously, Girl children below the age of 10.
• Interest Rate: 8.2%.
• Tax: EEE under the exemption. Also, Deposit, interest, and maturity amounts are under the tax-exemption.
• Mode of payment of interest: Hence, compounded Yearly.
• Minimum and Maximum Investment: From Rs.250 to Rs.1.5 Lakhs.

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8. Senior Citizen Savings Scheme – SCSS:

• Duration: 5 Years (can extend to 3 Years).
• Eligibility: Certainly, People above the age of 60.
• Interest rate: 8.2%.
• Tax : Tax exemption under 80C is given but interest is subject to tax.
• Mode of payment of interest: Hence, compounded Quarterly.
• Minimum and Maximum investment: From Rs 1,000 to Rs. 30 Lakhs.

9.  National Savings Monthly Income Scheme – MIS:

• Duration: 5 Years
• Eligibility: Indian Citizens.
• Interest rate: 7.4%.
• Tax: No tax exemption. Also, Interest is subject to tax.
• Mode of payment of interest: Hence, Monthly compounded.
• Minimum and Maximum investment: From Rs. 1,000 to Single account -Rs.9 Lakhs, Joint account-Rs.15 Lakhs

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Each scheme of the post office is designed in such a way that all types of people are being facilitated.

Post office schemes such as Post Office Saving Accounts, National Savings Recurring Deposits, Fixed Deposits, and National Savings Certificates are the schemes that provide interest and tax exemptions in the short duration of time.

Post office schemes such as Kisan Vikas Patra and Public Provident Fund double the investment made in the scheme over a long period of time.

Also, post office schemes like Sukanya Samriddhi Yojana and Senior Citizen Savings Scheme are specialized for a specific set of people.

Documents required:

The documents needed to apply for the post office schemes:

• Form
• KYC form
• PAN Card
• Aadhar Card
• Driving License
• Voter Card
• Identity card issued by MNREGA and signed by state government officials
• Birth Certificate/Age proof
• Passport

Read more Post Office National Saving Certificate