India Post currently offers interest at the rate of 6.9-7.7 per cent on investment in the Post Office Time Deposit Account (TD) - or fixed deposit - at designated post office branches. The interest rates applicable to small savings schemes such as Post Office Time Deposit Account (TD) are currently reviewed by the Ministry of Finance on a quarterly basis. For the quarter ending March 31 - the fourth quarter of the current financial year, the finance ministry last month retained the interest rates at existing levels. The Post Office Time Deposit Account (TD) is part of the nine government-run small savings schemes.
Here's all you need to know to set up a Post Office Time Deposit Account (TD):
India Post currently offers the time deposit - or fixed deposit - account in four maturity options: one year, two years, three years and five years.
For the fourth quarter of current financial year, investment in each of the one-three year options of time deposits fetches interest at the rate of 6.9 per cent. Investment in the fourth option - the five-year Post Office Time Deposit Account - fetches a return of 7.7 per cent.
Minimum Investment For Opening Account
For opening an account under the Post Office Time Deposit scheme, one needs to invest a minimum of Rs 1,000, according to the India Post website - indiapost.gov.in. Any higher amount in the multiple of Rs 100 can be used to set up a TD account. There is no upper limit for the investment.
Mode Of Operation
The Post Office Time Deposit Account is available in single and joint modes of operation. The account can be transferred from one post office to another, according to the India Post website.
Investment under the five-years Post Office Time Deposit Account qualifies for deduction in taxable income under Section 80C of the Income Tax Act.