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The Post Office Monthly Income Scheme (MIS) is a type of term deposit account offered by India Post. The MIS scheme pays interest each month and is suited for those who seek regular or supplementary income from their investments. This is a type of investment plan that is offered by the Department of Posts (DoP), also known as India Post. Those who would like to invest in Post Office monthly income schemes can do so at any post office in their respective locality. As of 1 April 2020, the interest rate offered on the Post Office Monthly Income Scheme is 6.6% p.a
Given below are the revised interest rates offered on Post Office MIS schemes with effect from 1st April 2020
Tenure | Regular rate (per annum ) | Senior Citizen Rate (per annum) |
---|---|---|
5 years | 6.6% | NA |
Amount | Maturity Period | Interest payment | Premature withdrawal |
---|---|---|---|
Single account - up to Rs.4.5 lakh Joint account - up to Rs. 9 lakh | 5 years | Credited each month to Post Office Savings Account | Allowed after 12 months. Penalty applicable. |
To open a monthly income scheme, you will have to pay a visit to the nearest post office. Ask for the application form, fill in details and submit identity and address proof documents. There is no online facility to open this type of account yet.
The post office savings account application form can be downloaded from here - https://www.indiapost.gov.in/VAS/DOP_PDFFiles/form/SB-3.pdf
Given below is the step-by-step process involved in opening a Post Office Monthly Income Scheme:
Step 1: Go to the nearest post office and first open a savings account.
Step 2: Ask for an application form and fill in required details.
Step 3: Submit a photocopy of identity and address proof documents along with passport size photos.
Step 4: Choose a nominee and deposit cash or a cheque.
Know more about Recurring Deposit
Post Office MIS scheme | Mutual funds | Fixed deposit |
---|---|---|
The interest rate offered is fixed at a given rate. | The rate of return varies and depends on market conditions. | The rate of interest paid is fixed. |
Guaranteed returns. | Returns are relative and not always guaranteed. | Assured returns. |
No TDS. | No TDS. | TDS applicable. |
Investment limit applicable. | No limit. | No limit. |
Lesser risk. | Moderate to high risk. | Nil risk. |
Premature withdrawal with penalty. | Minimum lock-in period of 3 years for SIP. | Premature withdrawal subject to penalty. |
Who can open an MIS account? |
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Documents required |
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Yes.
Yes. The vice-versa can also be done.
India Post has stopped making bonus payments with effect from 2011.
Rs.1,500.
12 months.
The nominee can furnish the death certificate and claim the maturity amount that is entitled to him/her. In case there is no nominee, the legal heir can make a claim on the same.
The sharing will be made on a 50:50 basis. This means that each depositor in a joint account will get an equal share.
Yes. This can be done.
It is at the rate of 2%.
Many individuals opt for various Post Office Schemes due to their financial stability, security, and safety. As per the latest details that have been issued by the Department of Posts, the government has decided to keep the interest rates on the different post office schemes the same for the second quarter of the FY 2020-2021. The date that has been mentioned on the circular is 1 July 2020. In the case of term deposits with a tenure ranging between 1 year and 3 years, the rate of interest will be 5.5%. In the case of a 5-year Term Deposit, the interest rate will be 6.7%. Any investments made towards the 5-year fixed deposits will be eligible for tax benefits under Section 80C of the Income Tax Act, 1961.
7 July 2020
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