India Post or Department of Posts, the postal system of the country, provides a range of services. The Department of Posts 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 India Post is 5-year recurring deposit account (RD), according to its official website, indiapost.gov.in.
Here are 10 things to know about Post office 5-year recurring deposit account:
1. Account opening: Post office recurring deposit account can be opened by cash or cheque and in case of cheque, the date of deposit shall be date of presentation of cheque. Any number of accounts can be opened in any post office.
2. Interest rate: The recurring deposit account offers an interest rate of 7.3 per cent per annum, which is compounded quarterly.
3. Return: On maturity, Rs. 10 per month fetches a return of Rs. 725.05. The post office RD account can be continued for another five years on a year-to-year basis.
4. Minimum amount: The minimum amount required for opening a recurring deposit account is Rs. 10 per month or any amount in multiples of Rs 5, which should be above Rs. 10, according to India Post.
5. Maximum amount: However, there is no upper limit on deposits.
6. Premature withdrawal: One withdrawal up to 50 per cent of the balance is allowed after one year. However, it should be repaid in one lump-sum along with interest at the prescribed rate at any time during the currency of the account.
7. Rebate: A customer get a rebate on advance deposit of at least 6 instalments, said India Post on its portal.
8. Account for minors: Account can be opened in the name of minor and a minor of 10 years and above age can open and operate the account.
9. Joint account: A joint account can also be opened by two adults and a single account can be converted into a joint account, and vice-versa.
10. Other facilities: Account can be transferred from one post office to another and nomination facility is also available at the time of opening and after opening of account.