Post Savings Accounts and Its Charges in India

India Post Savings Account is a Government of India deposit scheme in which the individual is liable to receive interest at a certain interest rate which is fixed by the Reserve Bank of India (RBI). Until now, Postal service has reached from rural to urban areas i.e. in every corner of the country and thus, many people in India have access to the post offices. India Post Savings Account is also a very useful scheme for people residing in rural areas. As the nationwide approach of post offices is far higher compared to banks, a huge portion of underprivileged individuals have been able to access the savings account via post offices. India Post provides various saving schemes which are as follows:

Post Office Savings Account

It is much easier to open a savings account in post offices than opening a savings account in banks.

The minimum balance for opening a post office savings account is Rs. 20.
One can open an account only by cash.
An account which is opened with Rs. 500 can avail cheque facility. To avail this facility, the account holder must maintain a minimum balance of Rs. 500.
The account holder who does not want to avail cheque facility must maintain a minimum balance of Rs. 50 in its account.
Account holder in its name can open one account in one post office.
There is no maturity period for the post office savings account. Therefore, it is easy and fast to open the account.
Tax exemption of Rs. 40,000 is permitted on interest earned as per the announcement in budget 2019.
To keep the account active, the account holder in three financial years must make at least one transaction of either a deposit or withdrawal.

For single/joint account 4% per annum interest rate is applicable.

National Savings Recurring Deposit Account

This scheme is basically a five-year monthly investment.
Individual can open the account by cash or cheque. If an individual wants to open an account through cheque, then must mention the date of deposit on the cheque.
The minimum balance for opening an account is Rs. 10.
Every month, a deposit has to made by the account holder. The last day is the 15th day of next month in case the account is opened up to 15th of a calendar month and if an account is opened from 16th day onwards till the last working day of a calendar month, then the last working day of a month will be last day to make the deposit. If a deposit is not made, then a default fee of Rs. 0.05 is charged for each default. The account is discontinued if 4 continuous default is made. The account holder gets 2 months to revive the account and if the same continues, then no more deposits will be accepted.
In case the advance deposit is made, then rebate of at least 6 instalments is granted. 7.2% per annum interest is received.

National Savings Time Deposit Account

Rs. 200 is the minimum balance for opening an account.
Advantage of Section 80C of the Income Tax Act can be availed if the investment is made under a period of 5 years.
When the time deposit is matured, then on the day of maturity, the account shall automatically be renewed for the same tenure with the current interest rate. The interest rate for 1st year account, 2nd year account and 3rd year account is 6.9%. 5th year account interest rate is 7.7%.

National Savings Monthly Income Account

To open the account, an individual has to maintain a minimum balance of Rs. 1,500. Maximum limit is Rs. 4.5 lakh for investment in a single account and Rs. 9 lakhs for investment in a joint account. In each joint account, all the account holders of joint account have an equal share.
The account matures in 5 years. 7.6% per annum.

National Savings Monthly Income Account

To open the account, an individual has to maintain a minimum balance of Rs. 1,500. Maximum limit is Rs. 4.5 lakh for investment in a single account and Rs. 9 lakhs for investment in a joint account. In each joint account, all the account holders of joint account have an equal share.
The account matures in 5 years. 7.6% per annum.

Senior Citizens Savings Scheme Account

Account can be opened by an individual whose age is above 60 years.
If an individual whose age is between 55 to 60 years and has retired under a superannuation or the VRS can open an account on subject to the condition that the account is opened within one month of receipt of pension, but the amount should not exceed the pension amount.
Range of investment is from Rs. 1,000 to Rs. 15 Lakhs. 8.6% per annum.

Public Provident Fund Account

The term of maturity is 15 years, but the account holder can extend for another 5 years.
Account can be opened with Rs. 100, but in every financial year, a minimum deposit of Rs. 500 must be made and the deposit amount should not exceed Rs. 1.5 lakhs in a financial year. 7.9% per annum.

National Saving Certificate (VII Issue) Account

Rs. 100 is the minimum limit to open an account. No maximum limit.
Maturity period is 5 years. 7.9% compounded every year but payable at maturity.

Kisan Vikas Patra Account

One can purchase a certificate for itself or can purchase jointly or on behalf of a minor.
After 2 & 1/2 years of the issuance of the certificate, it can be encashed.
Minimum balance is Rs. 1000 to open an account and has no maximum limit. 7.6% annually.

Sukanya Samriddhi Account

On behalf of the girl child, a legal guardian can open the account. Only one account can be opened on behalf of one girl child and up to two accounts in the name of two distinct girl child.
Minimum balance of Rs. 1,000 in a financial year is to be maintained to open an account. In case the account holder fails to deposit Rs. 1,000 in a financial year, then the account shall be discontinued and can be revived only by paying a penalty of Rs. 50 plus the minimum deposit per year. Maximum deposit limit in every financial year is Rs. 1.5 lakhs. 8.4% per annum.

Common features of Post Office Saving Scheme (except for National Saving Certificate (VII Issue) Account, Kisan Vikas Patra Account and Sukanya Samriddhi Account) are as follows:

Account holder can transfer an account from one post office to another.
A minor who is less than 10 years of age may open a saving account in his/her name, but it will be operated and administered by a parent or by a guardian. After the minor reaches the age of majority, he/she must apply for a change of account’s name in its name.
Two adults can open a joint account. The account holder can convert a single account into joint and vice versa.
While opening an account or after the account has been opened, the account holder can give the name of any person as a nominee. To know more about India Post Savings Scheme, one must visit the nearby post office or check the official website of India Post Office.