India Post, which runs the postal network of the country, offers nine saving schemes. Saving schemes in post offices offer interest rates between 4 per cent and 8.3 per cent, according to India Post's website, indiapost.gov.in. The lowest interest rate in Indian post office saving schemes is offered on post office saving accounts. The rest of the saving schemes in post office - recurring deposits, fixed deposits, post office monthly income scheme, senior citizen saving scheme, 15-year public provident fund account, national savings certificate, kisan vikas patra (KVP), and sukanya samriddhi account - offer interest rates between 6.6 per cent and 8.3 per cent.
Given below are saving schemes in post office with interest rates between 6.6% and 8.3%:
Post office time deposit account or fixed deposit account
Post office fixed deposit account can be invested into across four tenures - one year, two years, three years and five years. A one-year post office fixed deposit offers an interest rate of 6.6 per cent, a two-year fixed deposit pays 6.7 per cent as interest, a three-year post office fixed deposit offers 6.9 per cent interest, and a five-year fixed deposit pays 7.4 per cent interest rate. A five-year fixed deposit also offers income tax benefit under Section 80 C of the Income Tax (I-T) Act. Interest on post office fixed deposits is payable annually but calculated quarterly.
Post office recurring deposit (RD)
The post office recurring deposit, which requires a minimum investment of Rs 10 per month or any amount in multiples of Rs 5, offers a quarterly compounded interest rate of 6.9 per cent. If you deposit Rs 10 per month, the investment will fetch you a return of Rs 717.43. The post office recurring deposit account can be continued for another five years on year-to-year basis.
Post office monthly income scheme (MIS) account
Post office monthly income scheme, which has a maximum investment limit of Rs 4.5 lakh in a single account and Rs 9 lakh in joint account, offers an interest rate of 7.3per cent.
Kisan Vikas Patra (KVP)
KVP certificates, which can be encashed after two-and-a-half years, offer an interest rate of 7.3 per cent, which is compounded annually. The invested amount doubles in 118 months (9 years and 10 months).
15 year Public Provident Fund Account (PPF)
The public provident fund, which allows a deposit of Rs 1,50,000 in a financial year, pays an interest rate of 7.6 per cent per annum, which is compounded yearly. The deposits in PPF accounts can be made in lump-sum or in 12 instalments. The maturity period of PPF accounts is five years.
National Savings Certificates (NSC)
National savings certificates offer an interest rate of 7.6 per cent, which is compounded annually but is payable at maturity only. This means that a certificate of the value of Rs 100 gives you a return of Rs 144.23 after five years. NSC deposits qualify for tax rebate under Section 80C of I-T Act.
Sukanya Samriddhi Accounts
This saving scheme, meant only for the girl child, offers an interest rate of 8.1 per cent per annum, which is calculated and compounded on a yearly basis. A maximum of 1,50,000 can be deposited in this account in a financial year. There is no limit, however, on the number of deposits. The account can be closed after the girl child completes 21 years of age.
Senior Citizen Savings Scheme (SCSS)
This scheme allows for only one deposit subject to a maximum of Rs 15 lakh. The SCSS pays an interest rate of 8.3 per cent per annum. The interest is payable from the date of deposit of 31st March/ 30th September/ 31st December in the first instance and thereafter, interest is payable on 31st March, 30th June, 30th September and 31st December. Only senior citizens or an individual over 55 but less than 60 years of age can invest in this post office saving scheme.