How To Open Post Office Savings Account?

A Post Office Savings Account works just like a regular bank savings account, offering safe deposits, easy withdrawals, and interest on your balance. With simple procedures and nationwide availability, it is a popular choice for those looking for security and convenience. Let’s see how you can open a Post Office Savings Account and the benefits it offers.

Latest Update on Interest Rate

The Post Office Savings Account interest rate for Q2 (July-September) of FY 2025-26 has been retained at 4% per annum. 

What is a Post Office Savings Account?

A Post Office Savings Account is a government-backed deposit scheme available at all post offices across India. It offers a fixed interest rate (decided by the Government of India) and is ideal for individuals who want safe returns on their savings. With its wide reach, especially in rural areas, this account has made banking accessible to millions who may not have easy access to traditional banks.

How To Open Post Office Savings Account?

Here's a guide to opening your Post Office Savings Account (POSA): 

1. Visit your nearest post office or download the application form from India Post's website.
2. Fill out the form with your personal details.
3. Gather the required documents:

• Proof of identity (Aadhaar card, PAN card, etc.)
• Proof of address (Voter ID, utility bill, etc.)
• Passport-sized photograph

4. Deposit at least Rs. 500 in the account.

After completing the above steps, the Post Office Savings Account is usually opened within 2 working days.

Eligibility For Post Office Savings Account

• Any Indian adult can open a Post Office Savings Account.
• Minors aged 10 years and above are eligible to open an account in their own name.
• A guardian can open and manage an account on behalf of a minor who is under the age of 10.
• Joint accounts can be opened by two or three individuals together.
• An account can also be opened by a guardian on behalf of a person of unsound mind.

Post Office Savings Account Interest Features

• Interest Rate: Currently 4% p.a., decided by the Central Government.
• Calculation Method: Interest is calculated monthly based on the minimum balance between the 10th and the last day of the month.
• Eligibility for Interest: No interest is paid if the balance falls below ₹500 during this period.
• Crediting of Interest: Interest is credited at the end of each financial year.
• Tax Benefits: Interest earned up to ₹10,000 per year is exempt under Section 80TTA of the Income Tax Act.
• On Account Closure: Interest is paid only up to the month before the account is closed.

Benefits Of Post Office Savings Account

Opening an account with the Post Office savings scheme is simple and hassle-free compared to banks. Here are some key benefits it offers.

• You can open a post office savings account easily with a minimum balance of ₹500.
• There are no lock-in periods or maturity dates, so you can withdraw your money anytime as per your needs.
• The scheme offers assured returns at 4% p.a., with interest credited annually.
• With the wide network of post offices across India, your account is accessible even in rural and remote areas.
• The account is transferable between post offices, which adds to convenience when you relocate.
• Many core banking post offices provide ATM/Debit card facilities, making withdrawals and transactions easier.
• Nomination facility is mandatory at the time of opening, ensuring that funds are passed on smoothly in case of the account holder’s demise.
• In case of a joint account, if one holder passes away, the surviving holder continues as the sole account holder.
• Accounts can be converted from single to joint and vice versa, offering flexibility to account holders.
• There is no upper limit on deposits. 

Things to Remember:

• Be aware of fees for duplicate cheque books, statements, and other services.
• Transferring and pledging accounts incur a fee of Rs. 100.
• If balance falls below ₹500 at the end of a financial year, ₹50 will be deducted as a maintenance fee. 
• If balance becomes NIL, the account is automatically closed.

What is a Silent Account?

If there is no deposit or withdrawal in an account for about three continuous years, the said account will be treated as silent. Such accounts can be revived by submitting fresh KYC documents and the passbook at the concerned Post Office.

Tax benefits on Post Office Savings Account

• Income tax exemption on interest of up to ₹10,000 under Section 80TTA(all individuals)
• Additional exemption of ₹3500 (₹7500 for joint account holders) under Section 10(15)(i)
• No TDS deducted, but interest income must be declared in income tax returns

Withdrawal From Post Office Savings Account

The money deposited in a post office savings account can be withdrawn at any time by the account holder. A minimum balance of ₹50 is required for a regular savings account, while ₹500 must be maintained if the cheque facility is availed.

Steps to Activate Post Office Savings Bank Internet Banking For New Users:

1. Visit Indian Post eBanking website
2. Click on “New User Activation”
3.  Enter the required details- Customer ID (printed on the first page of your passbook) and Account ID
4. Once your activation process is completed, you will receive a ‘User ID’ within 48 hours,

Steps to Login For E Banking of Post Office Savings Account

1. Visit India Post eBanking website
2. Fill required details such as “User ID”and captcha code and click on “Log In”
3. Now, you can easily access your savings account. After logging in to the eBanking website, you will also be able to use different banking services, check balance etc.

Post Office Savings Bank Account Balance Enquiry

You can check your account balance in the following ways:

1. Post Office Missed Call Banking

2. Post Office SMS Banking