How To Open Post Office Savings Account?

An Individual enjoys having a savings account because it allows for speedy deposits and withdrawal when needed. The terms for opening and maintaining a savings account have also improved over time from the earlier years. The holders of the accounts also receive an attractive interest on the balance.

Similar to that with a bank, you can open a savings account with Post Office as well. Post Office Savings Account comes with attractive interest rates and other benefits.

Here is everything you should know about a Post Office Savings Account.

Definition Of Post Office Savings Account

Post Office Savings Account is a deposit scheme under the Government of India, operational at all post offices in the country. It yields returns on your investment at a fixed interest rate which is decided by the Reserve Bank of India (RBI).  It is a beneficial scheme for individual investors who wish to earn a fixed rate of interest by investing a significant portion of their financial assets. Post office savings account is also a very helpful scheme for those residing in rural parts of India. Since the nationwide reach of the post offices is much greater as compared to banks, a large number of unprivileged people have been able to get access to savings accounts through post offices.

Eligibility For Post Office Savings Account

• An adult can open a post offices savings account.
• The adult must be an Indian.
• In case a minor needs to open a post office savings account, he/she should be at least 10 years old.
• A guardian can also open an account on behalf of the minor.
• Two or three persons can open a joint post office savings account.
• A person who is not of sound mind, on behalf of him gaurdian can also open a post office savings account.

Interest Rates On Post Office Savings Account

The central government decides the interest rates on the post office savings account. It is at 4% and it is calculated every month. 

As per the provisions of income tax act, Interest earned up to Rs.10,000 in a financial year is exempt from taxable income.

Interest will be calculated on the basis of minimum balance between 10th of the month and end of the month and allowed in whole rupees only. No interest will be allowed in a month if balance between 10th and last day of the month falls below Rs.500.

Interest shall be credited in account at the end of each Financial Year at the interest rate prescribed by Reserve Bank Of India (RBI). At the time of closure of account, interest will be paid up to the preceding month in which account is closed.

Benefits Of Post Office Savings Account

Opening a savings account through post office is way easier than savings accounts in banks. Let us take a look at its benefits.

1. A post office savings account requires a minimum balance of Rs. 500 to open the account.
2. The cash can be withdrawn either partly or completely if needed.
3. The risk exposure is very less to the account holders because they can avail an assured return on all the investments.
4. The account can be transferred from one post office to another.
5. Core banking post offices also provide the facility of ATM/Debit cards.
6. An account can be opened in the name of minor who is below the age of 10 years. It will be managed and operated by the parent or guardian.
7. An account holder can nominate a person to whom the funds will be provided in case of any demise to the account holder.
8. Post office savings account does not have any maturity period. Hence, the account opening process is hassle-free and quick.
9. An individual account can be converted into joint account and vice-versa.
10. People residing in a rural area can open a savings account with the post-office.
11. There is no maximum limit for deposting.
12. If the minimum balance gets lower than Rs 500 at the end of the financial year, Rs 50 will be deducted as account maintenance fee.
13. If the minimum balance reaches NIL then the account wil be considered as closed. 

Silent Account: -

• If there is no deposit or withdrawal in an account for about continuous three years, the said account shall be treated as silent.
• Revival of such an account can be done by submitting an application along with fresh KYC documents and passbook at the concerned Post Office.

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 an amount which is not less than Rs.500
   Once the above steps are successfully completed, the savings account will be opened within 2 business days. 
    

Depositing and Minimum Balances:

1. Make an initial deposit: The minimum is Rs 500
2. Deposit limits: There is no limit as such for depositing.

Benefits and Features:

• No lock-in periods or maturity dates: Access your money whenever you need it.
• Wide network of branches: Post offices are conveniently located across India.
• Competitive interest rates: Earn attractive returns on your savings.
• Government-backed security: Your money is safe with the Indian government's guarantee.
• An individual can open only one account as a single account.
• A single account can be opened in the name of a minor who is above 10 years of age whether he may be a normal person or a person of unsound mind.
• In case of death of a Joint holder, the existing holder will be the sole holder, if existing holder already has a single account in his/her name, Joint account have to be closed.
• Conversion of single to joint account or joint to single account is not allowed.
• Nomination is compulsory at the time of opening of account.
• Minor after attaining majority, has to submit fresh account opening form and KYC documents of his/her name at concerned Post Office for conversion of his/her name.

Additional Information:

• Service charges: Be aware of fees for duplicate cheque books, statements, and other services.
• Transferring and pledging accounts: These actions incur a Rs.100 fee.

Withdrawal From Post Office Savings Account

The money deposited in a post office savings account can be withdrawn any time when the depositor needs. Only thing is a minimum balance of Rs. 50 should be maintained in case of a generic account and Rs. 500 in case of cheque facility.

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