Sukanya Samriddhi Yojana, Term Deposit, PPF to NSC: Post Office Schemes, Interest rates, Benefits compared

India Post offers a number of small savings schemes including the Sukanya Samriddhi accounts for the girl child, National Savings Certificates and Monthly Income Scheme Account. To make the most of these accounts, it is important to start investing now. More so, because the government recently raised the interest rates offered on deposits in these schemes. 

The India Post offers nine types of savings schemes. You can pick any of these as per your financial goals. Details are explained here:

Post Office Savings Account

This account offers 4.0% per interest rate on individual/joint accounts. The minimum balance to be maintained in a non-cheque facility account is Rs 50. Cheque facility is available if the account is opened with Rs 500 and for this purpose, the minimum balance of Rs 500 in an account is to be maintained. Cheque facility can be taken in an existing account also. 

Interest earned is Tax-Free up to Rs 10,000 per year from financial year 2012-13. 

5-Year Post Office Recurring Deposit Account (RD)

From October 1, the interest rate offered on this account is 7.3 % per annum (quarterly compounded). On maturity, a Rs 10/- account fetches Rs 725.05. The account can be continued for another 5 years on year to year basis.

One can invest minimum Rs 10 per month or any amount in multiples of Rs 5. There is no maximum limit.

Post Office Time Deposit Account (TD)

Interest on this account payable annually but calculated quarterly. One can invest a minimum Rs 200 and in multiple thereof. There is no maximum limit.

*Source: India Post

Post Office Monthly Income Scheme Account (MIS)

The interest rate offered on MIS is  7.3 % per annum payable monthly from October 1, 2018. The investment can be made in multiples of Rs 1500. The maximum investment limit is Rs 4.5 lakh in a single account and Rs 9 lakh in a joint account. An individual can invest maximum Rs 4.5 lakh in MIS (including his share in joint accounts). For calculation of share of an individual in a joint account, each joint holder has an equal share in each joint account. Maturity period is 5 years since 1-12-2011.

Senior Citizen Savings Scheme (SCSS)

From 01-10-2018, interest rates on SSCS are: 8.7 % per annum, payable from the date of deposit of 31st March/30th Sept/31st December in the first instance & thereafter, interest shall be payable on 31st March, 30th June, 30th Sept and 31st December.

- There can be only one deposit in the account in multiple of Rs 1000; maximum not exceeding Rs 15 lakh. An individual of the age of 55 years or more but less than 60 years who have retired on superannuation or under VRS can also open account subject to the condition that the account is opened within one month of receipt of retirement benefits and amount should not exceed the amount of retirement benefits. Maturity period is 5 years.
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15 year Public Provident Fund Account (PPF)

The interest rate offered on PPF at present is 8 % per annum (compounded yearly). On can invest minimum Rs 500 and maximum Rs 1,50,000 in a financial year. The deposits can be made in lump-sum or in 12 installments.

Deposits in PPF qualify for deduction from income under Sec. 80C of IT Act.

National Savings Certificates (NSC)

NSC offers 8 % interest rate, which is compounded annually but payable at maturity. An investment of Rs 100 grows to Rs 146.9 3 after 5 years. One can invest a minimum Rs 100 and in multiples of Rs 100. There is no upper limit. 

Deposits in NSC qualifies for tax benefits under Sec. 80C of Income Tax Act.

Kisan Vikas Patra (KVP)

The interest rates offered on KVP is now 7.7% compounded annually. Amount invested in this scheme doubles in 112 months (9 years & 4 months). The minimum investment is  Rs. 1000  and in multiples of Rs 1000. There is no maximum limit.

Sukanya Samriddhi Accounts: From 1st October, Post Office Sukanya Samriddhi Accounts offers 8.5% Per Annum Rate of interest, which is calculated on yearly basis, and yearly compounded.

- One can make a minimum deposit of Rs 1000 and maximum Rs 1,50,000 in a financial year. Subsequent deposit in multiple of Rs 100. 

- Deposits can be made in lump-sum. There is no limit on the number of deposits either in a month or in a Financial year. 

Read More Details: Post Office Sukanya Samriddhi Yojana: Invest Rs 14 lakh, gift your daughter Rs 46 lakh! Here's how