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Post Office National Savings Certificates: Interest Rates, Tax Benefits, Other Details

NSC offers a return of 8 per cent, which is compounded annually but payable at maturity.
NSC offers a return of 8 per cent, which is compounded annually but payable at maturity.

India Post or Department of Posts, the postal system of the country, provides a range of services. India Post, which has a network of over 1.5 lakh post offices across the country, offers several savings schemes with different interest rates. Interest rates on post office saving schemes move in line with the government's interest rates on small savings schemes, which are revised on a quarterly basis. One such savings scheme offered by post office is National Savings Certificates, according to its official website, indiapost.gov.in.

Here are 5 things to know about the post office National Savings Certificates (NSC):

1. Eligibility: A single holder type certificate can be purchased by an adult for himself/herself or on behalf of a minor or by a minor, according to India Post's portal. 

2. Amount: The minimum amount required for opening an NSC account is Rs. 100 in multiples of Rs. 100. However, there is no upper limit on NSC investments.

3. Interest Rates: NSC offers a return of 8 per cent, which is compounded annually but payable at maturity. An NSC of Rs. 100 will offer Rs. 146.93 on maturity after five years, noted India Post. 

4. Income tax benefit: Deposits in the National Savings Certificate qualify for deduction under Section 80C of the Income Tax Act. 

5. Transfer of certificates: At the time of transfer of certificates from one person to another, old certificates will not be discharged. Name of old holder shall be rounded and name of new holder shall be written on the old certificate.