Best Post Office Schemes For Investment in India

Indian Post Offices offer plenty of investment schemes for wealth build-up and monthly incomes.

This article will cover all Post Office investment schemes that provide better interest and return than banks.

The Ministry of Communications (Government of India) handles Indian Postal services.

On September 01, 2018, India Post Payment Bank started providing banking facilities in remote villages where nationalized banks lack service.

India Post Payment Bank has various investment schemes with attractive interest rates for girls, children, and senior citizens, which we shall discuss in this article.

Best Post Office Investment Schemes 2024

The Post Office provides flexible banking facilities and guaranteed investment schemes for wealth build-up and tax benefits.

Here are the best post office investments and banking facilities provided all over India-

1. Post Office Savings Account

• Scheme Name: Post Office Savings Account
• Minimum Investment: Rs 500
• Maximum Investment: No Limit
• Interest Rate: 4%
• Lock-in Period: No lock-in period
• Tax Benefits: NA

Post Office Savings Account is the most basic and safe scheme (bears the sovereign guarantee of the Government of India) that offers individual and joint account facilities.

A Post Office savings account is almost a zero balance account that requires minimum investments of Rs. 500 to open an account.

There is no limit for maximum investment in the savings account of India Post Payment Bank.

It provides online net banking, checkbook, and ATM card facilities to savings account holders.

Post Office Savings Account Interest Rate 2024

The latest annual interest rate for Post Office Savings Accounts is 4%, while the State Bank of India (SBI) offers a 2.7% interest rate if the balance is less than 10 crores and 3% above 10 crores.

Jump on the Savings Account Opening Process!

2. National Savings Recurring Deposit Account

• Scheme Name: Post Office Recurring Deposit Account
• Minimum Investment: Rs 100/month
• Maximum Investment: No Limit
• Interest Rate: 6.7% yearly (compounded quarterly)
• Lock-in Period: 5 years
• Tax Benefits: Exemption under 80C.

Post Office offers recurring deposits (RD) for decent corpus buildup in the short term. Anyone can start investing in Post Office recurring deposits with just Rs. 100 per month.

There is no limit on maximum investment. Any individual or joint account holder can avail of the benefits of this scheme.

You can start investing in Post Office RD for 5 years tenure to create a corpus for your short-term needs. It’s a safe investment, and there is no risk of market volatility.

You can also avail of a loan facility after 12 months of 50% of the sum credit in your RD account.

Post Office Recurring Deposit Interest Rate 2024

The interest rate for Post Office recurring deposit (RD) is 6.7% per annum compounded quarterly.

Is Post Office RD Tax-Free?

Post Office RD investment falls under 80C tax exemption, and you can get tax rebates up to 1.5 Lakh. However, interest earned on your RD investment is taxable as per the Income Tax Act 1961.

Jump on the Savings Account Opening Process!

3. National Savings Time Deposit Account

• Scheme Name: Post Office Time Deposit
• Minimum Investment: Rs 1000
• Maximum Investment: No Limit
• Interest Rate: 6.9 to 7.5% per annum
• Lock-in Period: 1 year to 5 years
• Tax Benefits: NA

National Savings Time Deposit is also known as Post Office Fixed Deposit (FD).

It’s one of the most popular and safest investments backed by a sovereign guarantee from the Government of India.

Post Office FD is a great investment scheme to achieve long-term financial goals.

Any Indian national individual can start a post office time deposit investment with just Rs. 1000. There is no limit for maximum deposits.

Post Office FD Interest Rate 2024

Post Office FD interest rate is revised every financial year by the Ministry of Finance, Government of India.

Here is the latest FD interest rate for 2024-

• 6.90% for a 1-year time deposit.
• 7.0% for a 2-year time deposit.
• 7.10% for a 3-year time deposit.
• 7.50% for a 5-year time deposit.

Is Post Office FD Tax-Free?

A 5-year post office fixed deposit is tax-free; however, interest earned exceeds Rs 40000 and may be charged under TDS (tax deducted at source).

The TDS chargeable income limit is Rs 50000 for senior citizens.

Does Post Office TD Come Under 80C?

A 5-year post office time deposit falls under the 80C exemption of the Income Tax Act 1961.

So, any individual can claim post office fixed deposit investment under 80C while filing income tax returns.

4. National Savings Monthly Income Account

• Scheme Name: Post Office Monthly Income Scheme
• Minimum Investment: Rs 1000
• Maximum Investment: Rs 4.5 Lakh
• Interest Rate: 7.4%
• Lock-in Period: 5 years
• Tax Benefits: NA

The Post Office offers a monthly income scheme for regular income. The investment scheme pays the interest on your invested amount every month.

It’s a great investment for senior citizens and retired personnel who want regular income from their capital.

You can start your investment from Rs 1000, and the maximum limit is 4.5 Lakh for individuals and 9 Lakh for joint account holders.

Post Office Monthly Income Scheme Interest Rate 2024

The interest rate for the Post Office monthly income scheme is 7.4% per annum (which is paid monthly).

Hence, you’ll get 0.62% interest every month. If your investment is 4.5 Lakh, you’ll receive Rs 2772 monthly.

If you’re a joint account holder and invested 9 Lakh in the Post Office Monthly Income scheme, then you’ll get Rs 5544 per month in your savings account.

Is Post Office MIS Tax-Free?

Post Office Monthly Income Scheme isn’t exempted from tax benefits. Hence, you can not claim tax exemption under section 80C of the Income Tax Act. However, no TDS will be charged on post office MIS investments.

Jump on the Savings Account Opening Process!

5. Senior Citizens Savings Scheme Account

• Scheme Name: Post Office Senior Citizens Scheme
• Minimum Investment: Rs 1000
• Maximum Investment: Rs 15 Lakh
• Interest Rate: 8.2%
• Lock-in Period: 5 years
• Tax Benefits: Exception up to 1.5 Lakh under 80C

Post Office Senior Citizens Savings Scheme is one of the great investments for retired personnel to enjoy retirement freedom.

Individuals or joint savings account holders can invest in post office senior citizens schemes.

Anyone above 60 can start investment from Rs 1000 (minimum) to 15 Lakh (maximum limit) in this scheme.

This scheme has a 5-year lock-in period. The interest rate of 8.2% per annum is paid quarterly to the account holder.

Post Office Senior Citizens Scheme Interest Rate 2024

The interest rate is 8.2% per annum for the Post Office senior citizens investment scheme. The interest is paid every quarter to the savings account.

6. Public Provident Fund Account

• Scheme Name: Public Provident Fund (PPF)
• Minimum Investment: Rs 500
• Maximum Investment: 1.5 Lakh/annum
• Interest Rate: 7.1%
• Lock-in Period: 15 years
• Tax Benefits: Tax-free Investment (Exempt-Exempt-Exempt) category

The Public Provident Fund (PPF) is a tax-free long-term investment scheme to achieve financial goals.

PPF is considered the safest investment, with a lock-in period of 15 years. It’s one of the best and risk-free investments in India.

This government-backed investment scheme provides a loan facility from the 6th year onwards.

Any Indian resident can start an investment from Rs 500 to 1.5 Lakh in a financial year.

The payment can be made in installments or lump sum.

The invested amount can be claimed under section 80C of the Income Tax Act.

The interest earned from PPF investment is also tax-free. Hence, it falls under the EEE (Exempt-Exempt-Exempt) category.

Post Office PPF Interest Rate 2024

The interest rate for PPF investment is revised every financial year. In 2024, the interest rate is 7.1% per annum. The PPF interest rate is the same for post offices and other nationalized banks.

Jump on the Savings Account Opening Process!

7. Sukanya Samriddhi Yojana

• Scheme Name: Post Office Sukanya Samriddhi Yojana (SSY)
• Minimum Investment: Rs 250
• Maximum Investment: 1.5 Lakh per annum
• Interest Rate: 8.2%
• Lock-in Period: 21 years
• Tax Benefits: Tax-free Investment (Exempt-Exempt-Exempt) category

Sukanya Samriddhi Yojana (SSY) is a government scheme launched by Prime Minister Narendra Modi that supports the initiative of ‘Beti Bachao, Beti Padhao‘ campaign.

It’s a great investment for the future of a girl child. Any girl below 10 years of age is eligible for account opening.

Only one account can be opened either in the post office or any bank. The account can be opened in the girl’s or parent’s name.

You can start investing in Sukanya Samriddhi Yojana from Rs 250 to Rs 150000 per year (maximum). There is no limit on the number of deposits in a month or year.

Post Office Sukanya Samriddhi Yojana Interest Rate 2024

The Sukanya Samriddhi Yojana interest rate is 8.2% per annum. The interest rate is calculated yearly, and investment is compounded yearly.

Is Sukanya Samriddhi Yojana Tax-Free?

Yes, investment and interest earned from Sukanya Samriddhi Yojana (SSY) are tax-free.

8. National Savings Certificates

• Scheme Name: Post Office National Savings Scheme (NSC)
• Minimum Investment: Rs 1000
• Maximum Investment: No limit
• Interest Rate: 7.7%
• Lock-in Period: 5 years
• Tax Benefits: Exemption under 80C

Post Office provides a lucrative investment scheme that provides guaranteed returns.

Any Indian resident can start investing in National Savings Certificates (NSC) and avail of tax exemption under 80C.

You can start investing in NSC from Rs 1000 per annum. There is no upper limit to investment under NSC.

It comes with a 5-year lock-in period. It means you can not withdraw the investment amount before maturity.

Post Office NSC Interest Rate 2024

National Savings Certificate offers a guaranteed interest rate of 7.7% per annum, which is paid on maturity.

Is Post Office NSC Tax-Free?

The interest earned from NSC investment is taxable and can be declared as ‘Income from Other sources‘ in your income tax returns (ITR).

Does Post Office NSC Come Under 80C?

Yes, NSC investment can be claimed under 80C of the Income Tax Act. The maximum exemption limit of 1.5 lakh is applied under 80C.

9. Kisan Vikas Patra

• Scheme Name: Post Office Kisan Vikas Patra (KVP)
• Minimum Investment: Rs 1000
• Maximum Investment: No limit
• Interest Rate: 7.5%
• Lock-in Period: 2 years and 6 months
• Tax Benefits: Tax-free Investment (Exempt-Exempt-Exempt) category

Kisan Vikas Patra (KVP) is a small investment program to empower India’s farmers.

It’s a safe post office investment scheme that doubles your money in 123 months (10 years and 3 months).

If you’re searching for a Post Office double money scheme, then Kisan Vikas Patra (KVP) is the correct scheme.

Post Office Kisan Vikas Patra Interest Rate 2024

The interest rate for Kisan Vikas Patra for the financial year 2024-2025 is 7.5% per annum.

10. PM Cares For Children Scheme

PM Cares for Children Scheme is a great initiative to provide financial support to those children who lost their parents in the Covid-19 pandemic.

Account will be opened in the name of a beneficiary with the concerned District Magistrate as joint account holder for an eligible beneficiary who has not attained the age of 18 years on the date of the event.

In this scheme, the Government of India will pay Rs 5000/month as a stipend to support educational needs, and a lumpsum of Rs 10 Lakh will be given when he/she turns 23 years for professional support.

Eligible candidates can apply for the PM Cares for Children Scheme in the Post Office.

How To Open a Post Office Savings Account?

Opening a Savings Account in the Post Office is very easy. You just need to carry your original Aadhar Card and PAN Card to the nearest post office that provides a banking facility.

Ask for an account opening from the counter and correctly fill in all your details.

Attach a self-attested copy of your Aadhar Card and PAN Card as identity and address proof.

Paste two latest color passport-size photographs on the account opening form and submit them on the counter.

Deposit Rs 500 in cash at the banking counter, and they will open your savings bank account within 3 working days.

Collect your passbook from the Post Office and apply for a Debit Card, net banking, and cheque facility.

Enjoy the Post Office banking facilities and high interest rates on your savings account.

How To Open a Post Office Recurring Deposit Account?

Any individual post office savings account holder can open a Recurring Deposit (RD) account online via an e-banking facility.

You can also open the recurring deposit account offline by visiting the nearest post office to your home address.

Here is how to open a post office recurring deposit account online-

• Step #1: Visit https://ebanking.indiapost.gov.in
• Step #2: Enter the user ID and verify the captcha.
• Step #3: Enter your Login password.
• Step #4: Click on the ‘General Service‘ tab on the menu and click on the ‘Service Request‘ tab.
• Step #5: Under ‘Service request,’ click on the ‘New Requests‘ tab
• Step #6: From the options, click on ‘RD Accounts- Open an RD Account.’
• Step #7: On the new page, enter all the details required.
• Step #8: Click on ‘Submit‘ and check the details on the next page
• Step #9: Enter your ‘Transaction password.’

Once you submit the online application form, you’ll be asked to verify the OTP. After finishing the OTP verification, you’ll receive a recurring deposit (RD) account number.

You can link this recurring deposit account number with your savings account for automatic deduction.

How To Open Public Provident Fund in Post Office?

Take your original PAN card and Aadhar card and visit the nearest post office, which provides banking facilities.

Collect a PPF account opening form from the counter and correctly fill in all your details.

Provide your savings account number and paste two color passport-size photographs on the application form.

Attach a self-attested copy of your Aadhar and PAN card and submit the application form.

The authorized person will open your PPF account and provide you with a passbook printed with an account number and all your details.

How To Open Post Office Monthly Income Scheme?

If you want to open a Post Office Monthly Income Scheme account, follow these steps-

• Visit your nearest post office and ask for the MIS scheme account opening form.
• Fill out the offline form correctly and attach a self-attested copy of your Aadhar card and PAN card.
• Paste the latest 2 passport-size color photographs on the application form.
• Provide your original Aadhar and PAN card for verification.
• Verify the physical KYC.

That’s it. Your Monthly Income Scheme (MIS) account will be opened. You’ll receive an account number where you can start the investment.

Frequently Asked Questions

Conclusion

India Post Payment Bank provides great opportunities for safe investments. The banking facilities are backed by the Ministry of Communication and the Ministry of Finance, Government of India.

Post Office investments are an excellent choice if you don’t want to risk your money and are looking for guaranteed returns.

You can invest in Post Office Fixed Deposits, Recurring Deposits, Monthly Income Schemes, Public Provident Funds, Sukanya Samriddhi Yojana (SSY), and Kisan Vikas Patra (KVP).

Visit your nearest Post Office for more details.