Salient Features

  • Interest rate of 8.50% per annum payable monthly.
  • 5% bonus also payable on maturity (for accounts opened before 1st December 2011), for accounts opened after 1st December 2011 no bonus payable on maturity.
  • Maturity period is 5 years.
  • Maximum amount is Rs. 4.50 lakhs in a single account and Rs.9 lakhs in a joint account.
  • Premature encashment facility after one year.
  • No TDS.
  • Account can be opened by an individual, two/three adults jointly, and a minor through a guardian.
  • A minor having attained 10 years of age can open an account in his/her own name directly.
  • Non-Resident Indian / HUF cannot open an Account. Minors have a separate limit of investment of Rs. 3 lakhs and the same is not clubbed with the limit of guardian.
  • A separate account is opened for each deposit.
  • Any number of accounts can be opened subject to the maximum prescribed limit.
  • Facility of automatic credit of monthly interest to saving account if accounts are at the same post office.
  • Facility of premature closure of account after 1 year to 3 years @ 2.00% discount.
  • Deduction of 1% if account is closed prematurely at any time after three years.
  • Facility of reinvestment on maturity of an account.
  • Interest not withdrawn does not carry any interest.
  • Maturity proceeds not drawn are eligible to earn savings account interest rate for a maximum period of two years.
  • Account is transferable to any Post Office in India, free of cost.
  • Nomination facility is available.
  • Rebate under section 80 C is not admissible.
  • Most suitable scheme for senior citizens and for those who need regular monthly income.
  • Deposits are exempt from Wealth Tax.