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Post Office Saving Schemes 2025-26: Interest Rate, Benefits, Features and Plan Comparison

By Ektha Surana

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Updated on: May 6th, 2025

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5 min read

Post Office investment-savings schemes in India offer secure, government-backed options with guaranteed risk free returns.  Around 1.65 lakh post offices spread all over the country operate these schemes. 

These schemes cater to risk-averse investors and include popular products like the Public Provident Fund (PPF), Senior Citizen Savings Scheme (SCSS), and Monthly Income Scheme (MIS).

Investments in post office schemes help to create a corpus for emergency purposes and achieve goals. They also offer tax benefits up to Rs.1.5 lakh under Section 80C of the Income Tax Act.

Recently, deposit limits have been increased, making them even more attractive. The following table summarizes the details of various post office schemes.

Scheme

Interest Rate (Applicable from 01/04/2025)

Minimum Investment

Maximum Investment

Eligibility

Tax Implications

Post Office Savings Account4% per annum (p.a.)Rs. 500No limitResident Indian, minor (above 10 years) and major.Tax-free interest up to Rs 50,000 for senior citizens 
Post Office Time Deposit Account (TD)One-year – 6.9% p.a.   
Two-year – 7.0% p.a.   
Three-year – 7.1% p.a.   
Five-year – 7.5% p.a. 
(Compounded Quarterly)
Rs 1,000No limitResident Indian, minor(above 10 years) and major
  • Interest is taxable.
  • TDS applies if interest exceeds ₹40,000/year (₹50,000 for senior citizens)
Post Office Recurring Deposit AccountFive Years - 6.7% p.aRs 100No limitResident Indian, minor(above 10 years) and majorTax-free interest up to Rs 50,000 for senior citizens 
Post Office Monthly Income Scheme Account (MIS)7.4% per annum payable monthlyRs 1,000For single account- Rs 9 lakh   
Joint account accounts- Rs 15 lakh
Resident Indian, minor(above 10 years) and major

  • Tax benefit u/s 80C for deposits 
  • Interest earned is taxable 
  • TDS applies on interest earned for more than Rs 50,000 p.a.
Senior Citizen Savings Scheme (SCSS)8.2% p.a. (Compounded Quarterly)Rs 1,000Maximum deposit over the lifetime allowed at Rs 30 lakhIndividuals of age> 60 years or age between 55 and 60 for retired civilian or defense employees
  • Tax benefit u/s 80C for deposits   
  • TDS applies on interest earned for more than Rs 50,000 p.a.
15-year Public Provident Fund Account (PPF)7.1% p.a. (Compounded annually)Rs 500 per financial yearRs 1.5 lakh per financial yearResident Indian, minor and majorDeduction under Section 80C for deposits (maximum Rs 1.5 lakh p.a.)  
interest is tax-free.
National Savings Certificates (NSC)7.7% p.a. (Compounded annually)Rs 1,000No limitResident Indian, minor and majorTax rebate u/s 80C for deposits (maximum Rs 1.5 lakh p.a.)
Kisan Vikas Patra (KVP)7.5% p.a. (Compounded annually)Rs 1,000No limitResident Indian, minor and majorInterest is taxable, but no tax on the amount received on maturity
Sukanya Samriddhi Accounts8.2% p.a. (Compounded annually)Rs 250 per financial yearRs 1.5 lakh per financial yearGirl Child – up to 10 years from birthInvestment (up to Rs 1.5 lakh exempt u/s 80C), interest and amount received on maturity is tax-free

Savings Schemes Under Post Office Investments

The various savings schemes under post office investments are given below.

Post Office Saving Schemes 2025-26

Advantages of the Post Office Investment-Saving Schemes in India

Easy to Invest

The savings schemes are easy to enroll in and best suited for rural and urban investors. Anyone who wants to hedge risk in the portfolio for a fixed decent return can invest in these schemes. The simplicity and availability make these investments a much-preferred savings cum investment option. 

Documentation and Procedures

Limited documentation and proper procedures in the post office ensure that these saving schemes are simple to opt for and safe to be locked onto as the government backs them. 

Fulfilment of Investment Goals

The investments in the Post Office Schemes are long-term oriented, with the investment period extending up to 15 years for a PPF account. Therefore, these investment options are excellent for retirement and pension planning. 

Tax Exemption

Most of these schemes are eligible for tax rebates under Section 80C for the deposit amount. A few schemes like the PPF, the Sukanya Samriddhi Yojana, etc., also have the interest earned amount exempted from taxation. 

Interest Rates

Interest rates in these schemes range from 4% to 9% and are risk-free. A minimal amount of risk is involved as the Government of India undertakes these investment options.  

Different Buckets of Products

There is a wide range of products based on different types of individuals. Public Provident Fund (PPF), Kisan Vikas Patra and Sukanya Samriddhi Yojana are well-known schemes. The government has made these small savings schemes available via post offices to provide a safe investment avenue for the public by providing good returns and keeping their investments safe. These schemes are easy to manage.   

Post Office Savings Schemes

Post Office Savings Account

  • Post Office Savings Account Can be opened individually or jointly.
  • This account offers cheque book, ATM, mobile and e-banking services on request.
  • If it has been inactive for three financial years, it becomes dormant; it can be revived with KYC and a passbook.

5-Year Post Office Recurring Deposit (RD)

  • In post office RD, Interest is compounded quarterly.
  • Loan up to 50% of the balance available after 12 regular deposits.
  • Can be closed prematurely after 3 years; if closed early, a lower interest rate applies.

Post Office Time Deposit (TD)

  • Post Office Time Deposit can be pledged as security to banks and financial institutions.
  • Early closure allowed after 6 months; interest rate drops if closed before 1 year.
  • Premature closure needs a form and a passbook submission.

Post Office Monthly Income Scheme (MIS)

  • POMIS pays monthly interest throughout the tenure.
  • Premature closure is allowed only after 1 year and attracts a 1–2% penalty, depending on when it is closed.
  • In case of death, the nominee can claim the amount with interest up to the previous month.

Senior Citizen Savings Scheme (SCSS)

  • SCSS account Can be opened by individuals aged 60+ or jointly with a spouse.
  • It offers regular income and tax benefits under Section 80C.

15-Year Public Provident Fund (PPF)

  • Public Provident Fund Provides tax benefits under Section 80C (up to ₹1.5 lakh/year).
  • The account can be extended in 5-year blocks after maturity.
  • Interest is credited annually; a minimum deposit of ₹500/year is required to keep the account active.

National Savings Certificates (NSC)

  • National Savings Certificate has fixed 5-year tenure with guaranteed returns.
  • Investment in NSC is eligible for tax deduction under Section 80C.
  • It can be pledged as collateral with banks or housing finance companies.

Kisan Vikas Patra (KVP)

  • Kisan Vikas Patra doubles investment over a fixed tenure (depends on the prevailing interest rate).
  • It can be pledged as security with banks.

Sukanya Samriddhi Account (SSA)

  • Sukanya Samriddhi Account can be opened for female children under 10 years, operated by parents/guardians.
  • It offers tax benefits and a high interest rate.
  • It cannot be closed 1 month before or 3 months after the child’s marriage.

How to Open a Post Office Saving Schemes Account?

Post Office Saving Schemes are suitable for individuals with a low-risk appetite. The returns from these schemes are not prone to market fluctuations, making them ideal for risk-averse investors who still wish to make the most of their savings. You can open a post office savings scheme account online through Internet banking, mobile app or by downloading the account opening form.

Through Internet Banking

Step 1: Visit the Department of Posts (DOP) Internet Banking website
Step 2: Click the 'New User Activation' button. 
Step 3: Enter the 'Customer ID' and 'Account ID' and click the 'Continue' button. You can also visit your home post office branch, fill out the application form for activating Internet banking and submit the required documents.  
Step 4: Once Internet banking is activated, enter your user ID and password to log in to your DOP Internet banking. 
Step 5: Click on the 'General Service' tab on the menu and click on the 'Service Request' tab. 
Step 6: Under the 'Service Request' section, click the 'New Requests' tab. 
Step 7: Select the type of account you want to open from the multiple options. 
Step 8: Enter the details on the application form and click the 'Submit' button.

Through Mobile App

Step 1: Download and log into the ‘India Post Mobile Banking’ app on your mobile from Google Play Store
Step 2: Upon successful login, select the ‘Requests’ tab on the home screen to open a post office saving account.

POFD_Request Tab

Step 3: Enter the details, such as the deposit amount, tenure, the account from which you want to deposit the money, nominee, and others and submit.

By Downloading the Application Form

Step 1: Download and print the relevant application form from the post office’s official website
Step 2: Attach all the necessary documents. 
Step 3: Visit your home branch of the post office and submit the documentation to the relevant personnel. 
Step 4: Pay the minimum amount required to open the account/scheme. 
Step 5: The post office officials will verify your application, open your account and also give the passbook for the account.

Documents Required to Open Post Office Savings Scheme

  • Account Opening Form
  • KYC Form (For new customer/modification in KYC details))
  • PAN Card
  • Aadhaar card, if Aadhaar is not made available, the following document may be submitted.
    • Passport
    • Driving license
    • Voter’s ID card
    • Job card issued by MNREGA signed by the state government officer
    • Letter issued by the National Population Register containing details of name and address.
  • Proof of date of birth/birth certificate in case of a minor account.
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Frequently Asked Questions

Can Monthly Income Scheme (MIS) interest be credited to Recurring Deposit (RD) account?

MIS interest cannot be credited to post office RD account. It can be credited to post office savings account. You can give standing instruction to debit RD amount from SB account. An application form should be submitted to respective Post Office for the same.

What are the premature encashment conditions for post office savings scheme?
Savings account  ​No lock-in period
RDAfter 3 years, but SB rate of interest will be applicable
TDAfter 6 months but preclosure fee is applicable
MISAfter 1 year but preclosure fee is applicable.
PPFAfter 5 years but only in specific cases such as- Severe illness, higher studies, and NRI status.
​SSA                           ​After 5 years of account opening for extreme compassionate grounds
​SCSS   ​No lock-in period but preclosure fee is applicable.
​NSC (VIII Issue)​Premature withdrawal is not permitted (except in case of death and forfeiture).​
​KVP​​After 2.5 years 
 
Is there a tax rebate for investment in post office savings schemes?

You can take Section 80C deduction for investment in most of the post office savings scheme. However, such tax deduction is not available for investment post office MIS or recurring deposit schemes.

Can students open a post office savings Scheme?

Yes, students above 18 years can invest in the post office saving scheme. Students can open any post office savings scheme of their choice except for Sukanya Samriddhi Yojana (SSY) and Senior Citizen Savings Scheme (SCSS) since SSY is opened for a girl child below 10 years by the girls' parents or guardian and only senior citizens can open the SCSS. 

Which post office savings scheme is suitable for 5 years?

The 5-Year Post Office Recurring Deposit Account (RD) is suitable when you are looking for investments with a lock-in period of 5 years.

Can I transfer money from the post office to my bank account?

Yes. You can transfer by filling out and submitting the application for account transfer with the Post Office branch. 

Can I check my post office account online?

Yes, you can check your account online using internet banking. You should have KYC documents and a DOP ATM card to check the post office account balance.

Can senior citizens claim deductions for investing in post office savings accounts?

Yes, senior citizens can claim a deduction up to Rs. 50,000 under section 80TTB for investing in post office savings accounts. Also, individuals below the age of 60 can claim a deduction of Rs. 10,000 under section 80TTA for investing in a post office savings account.

Is there any maximum limit for deposits in post office savings accounts?

There is no maximum limit for deposits in post office savings accounts. However, an individual can deposit a minimum of Rs.500 for opening a post office savings account.

Do all post office in India provide the facility of investing in savings scheme?

Yes, you can invest in tax savings schemes in any post office which is near you.

About the Author

Multitasking between pouring myself coffees and poring over the ever-changing tax laws. Here, I've authored 100+ blogs on income tax and simplified complex income tax topics like the intimidating crypto tax rules, old vs new tax regime debate, changes in debt funds taxation, budget analysis and more. Some combinations I like- tax and content, finance & startups, technology & psychology, fitness & neuroscience. Read more

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