INSUBCONTINENT EXCLUSIVE:
India Post (post office) account return: Individuals can choose from a range of savings scheme accountsThe post office - under India Post -
offers several kinds of accounts for making investment today
India Post, which has a network of more than 1.55 lakh post offices across the country, offers a variety of banking and remittance services,
other than mailing services
The post office offers an investment return - or interest rate per annum - ranging from 4 per cent to 7.4 per cent in five of those savings
(TD) account, post office monthly income scheme (MIS) and Kisan Vikas Patra (KVP), among others.Post office savings schemeInterest
rateMaturity periodMinimum amount for opening accountMaximum amount permittedSavings account4%-Rs 20-Monthly income scheme (MIS)7.3%5
yearsRs 1,500Rs 4.5 lakhTime deposit (TD)6.6% for 1 year; 6.7% for 2 years; 6.9% for 3 years; 7.4 per cent for 5 years1-5 yearsRs 200No
limitRecurring deposit (RD)6.9%5 yearsRs 10 per monthNo limitKisan Vikas Patra (KVP)7.3%118 monthsRs 1,000No limit(Source:
indiapost.gov.in)Other than the savings account, which does not have a defined maturity period, the post office accounts have a maturity
period ranging from one year to nine years and 10 months
Here's a comparison among five post office savings schemes - savings account, recurring deposit, time deposit, monthly income scheme and
KVP - on the basis of important factors such as interest rate and minimum/maximum investment limits.Post office monthly income scheme
(MIS)The post office monthly income scheme offers an annual return of 7.3 per cent
One can enter the post office monthly income scheme with a minimum amount of Rs 1,500
The scheme allows investment in multiples of Rs 1,500
The maximum amount permitted for investment is Rs 4.5 lakh in case of a single account and Rs 9 lakh for joint a account
The MIS comes with a maturity period of five years, according to India Post's website - indiapost.gov.in.Post office Kisan Vikas Patra
(KVP) schemeThe Kisan Vikas Patra account provides an interest rate of 7.3 per cent
Deposits can be made in multiples of Rs 1,000
There is no upper limit prescribed by India Post on the KVP scheme
accountIndia Post provides an annual return of 4 per cent on savings account deposits
A post office savings account, which comes with the ATM facility, can be opened against a cash payment of a minimum Rs 20
The interest earned through the savings account is tax-free up to Rs 10,000 in a financial year, according to India Post
The savings account comes with optional features such as cheque book and nomination facilities, according to India Post.Post office
recurring deposit accountThe post office RD account, known as the five-year post office recurring deposit account, offers an interest rate
The recurring deposit can be set up with a minimum amount of Rs 10 per month
In a recurring deposit, the investor deposits a fixed amount of money in regular intervals
Contribution in the multiples of Rs 5 can be chosen to invest in the five-year RD account
The interest rate of 6.9 per cent is compounded on a quarterly basis, which means an RD of Rs 10 - in which the account holder pays Rs 10
every month - provides a return of Rs 717.43 in the maturity period of five years, according to India Post.Post office time deposit (TD)
accountThe post office provides an interest rate of 6.6-7.4 per cent on time deposit accounts
The time deposit or TD account allows a maturity period ranging from one year to five years
The rate of return on investment depends on the maturity period selected by the investor
The interest is calculated on a quarterly basis and paid on an annual basis, according to India Post
The TD account can be opened with a minimum amount of Rs 200
Any amount in the multiple of Rs 200 can be invested in the scheme
The post office TD account has no stipulated maximum investment limit
Out of the four maturity periods available, the five-year option qualifies for the benefit of Section 80C of the Income Tax Act
Section 80C of the Income Tax Act allows deduction of Rs 1.5 lakh from total income in a financial year
That means one can claim reduction up to Rs 1.5 lakh on total taxable income in a year.