Post Office Savings Scheme – Benefits, Features & Interest Rate

A Post Office Savings Scheme Account is one of India’s most well-known and widely available savings accounts. Both the base store and the most extreme equilibrium that can be kept are Rs.500. It can also be opened for a minor over the age of ten. One Account can be opened as a single Account. The maximum amount that can be held in a Post Office Savings Account is unlimited. It is also eligible for a duty exemption under the Income Tax Act 80TTA for premiums up to Rs.10,000 purchased in a fiscal year (for all investment accounts consolidated).


Post Office Savings Scheme

In many ways, a Post Office Savings Scheme Account is similar to a regular savings account. It is regarded as a very reliable instrument for storing assets, with the ability to sell supports in full or in part at a very surprising bit of news on the off chance that the need arises. These accounts typically provide a guaranteed return on investment, making them ideal for senior citizens and those seeking a steady income without risk.


Scheme Name Post Office Savings Scheme
Initial Deposit Requirement Rs.20
Minimum balance for accounts that do not have a cheque book Rs.50
Account with a cheque book requires a minimum balance or an initial deposit Rs.500
Interest rate 4% p.a.
Tax Free Interest Up to Rs.10,000 p.a.

You must be an adult and an Indian in order to open a Post Office Savings Scheme Account. To open a Post Office Savings Account, a minor must be 10 years old. Two or three people are necessary to open a joint Post Office Savings Account.

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Post Office Savings Scheme Features

The following are the main characteristics of a Post Office Savings Scheme Account:


  • You have the option to close his or her account at any time.
  • Minors over the age of ten can work on accounts.
  • To keep the Account dynamic, at least one store or withdrawal should be made at regular intervals.
  • The only way to open the Account is with money.
  • The facility of nomination is available both at the time of account opening and afterward.
  • Every year, interest is tax-free up to a maximum of Rs 10,000.
  • The amount of interest is eligible for income tax relief under section 80L of the Internal Revenue Code.
  • Accounts can be converted from single to joint and vice versa.
  • Stores and withdrawals can be made using any electronic method at CBS Post offices.
  • ATMs are available for transactions.

Post Office Savings Scheme Benefits

Following are a few of the appealing features of Post Office Savings Scheme Accounts:

  • Cheque facility: For existing accounts, a cheque facility is available and can be requested.
  • ATM/Debit card: CBS Post Offices can issue ATM/Debit cards to account holders who have maintained the required minimum balance on the day the debit card is issued.
  • Minor Accounts: Minors can open a Post Office Savings Scheme Account. An account can be opened in the name of a minor under the age of ten, but the parent or guardian will have the authority to operate the account on their behalf. Accounts can be operated independently by minors over the age of ten.
  • Portability: You can transfer your Post Office Savings Account to another branch if you move, are dissatisfied with the administration provided by the post office branch, or for any other reason. Only one Account can be opened at a time in each post office.
  • Nomination: These Accounts allow you to designate someone to open the Account at a specific time. The Account holder can designate someone to receive the Account’s returns after their death at any time.
  • Joint Accounts: The joint account facility allows two or three adults to hold an account together. It is possible to convert a single account to a joint account and vice versa.
  • Long period of inactivity: You only need to set aside one installment or withdrawal every three monetary years to keep your Account active. The Account will be considered dormant unless there have been no exchanges for three monetary years.

Post Office Savings Scheme Eligibility Criteria

Those who meet the prerequisites are eligible to open a Post Office Savings Scheme Account.

  • Minors under the age of ten years
  • On behalf of a minor, a guardiana
  • a person who is mentally ill
  • A joint account can be opened by two or three adults.
  • Accounts such as Group Accounts, Institutional Accounts, and Security Deposit Accounts & Official Capacity Accounts are not permitted.

How to Open Post Office Savings Scheme Account?

To open a Post Office Savings Account, follow these simple steps.


Step 1: To obtain an application form, go to your nearest post office or visit India Post’s official website.

Step 2: Complete the form with the necessary information.

Step 3: Please provide all necessary documents as well as a passport-sized photograph.

Step 4: Deposit a sum of money that cannot be less than Rs.20.

Step 5: If you want to open a Post Office Savings Scheme Account without a cheque book, you must make a minimum deposit of Rs.50.

A single account holder can deposit a maximum of Rs one lakh, while a joint account holder can deposit a maximum of Rs two lakhs. The lack of a lock-in or maturity period is one of the most appealing aspects of a Post Office Savings Scheme Account. Opening this type of account is relatively simple, as one can walk into any post office, complete the necessary paperwork with the clerk, and open an account right away.

Post Office Savings Scheme Service Fees on Savings Accounts

If you want to open a Post Office Savings Account, keep in mind that there are a few service fees to consider:

  • The cost of issuing a duplicate cheque book is Rs.50.
  • Deposit receipts are issued at a cost of Rs.20 per receipt.
  • Account statements are issued at a cost of Rs.20 per statement.
  • 50 for cancellation or change of nomination.
  • In lieu of a missing or mutilated certificate, a passbook will be issued at a cost of Rs.10 per registration.
  • Issuing a cheque book from a savings bank account: There is no charge for the first ten leaves in a financial year. (Thereafter, Rs.2 per cheque leaf)
  • 100 for transferring an account and pledging an account
  • Fee for a dishonored check is Rs.100.

Post Office Savings Scheme Interest Rate

The interest rate on Post Office Savings Scheme Accounts is set by the Central Government on a regular basis and ranges between 3% and 4%. Interest is calculated and credited annually on monthly balances.

Savings accounts at the Post Office earn a fixed rate of interest throughout the year, which is subject to change as needed. At the moment, the interest rate is as follows:

Details Percentage (p.a.)
Rate of Interest 4%

Post Office Savings Scheme Account Withdrawals

The amount deposited in a Post Office Savings Account can be withdrawn at any time to meet the depositor’s needs. However, the withdrawal is conditional on maintaining a minimum balance of Rs. 50 in a simple account and Rs. 500 in accounts with a cheque facility.

The current interest rate for Post Office Savings Account is 4.00 percent per annum. If you still find any doubts about the Post Office Savings Scheme, please feel free to mention them in the comment section below.

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