Post Office Fixed Deposit Rates & Post Office scheme
The post office fixed deposit is also known as a time deposit. It is convenient and alternative for the fixed deposits provided by the bank.
The scheme is offered by the Indian postal services, an individual can earn a guaranteed return on the money deposited to a fixed period of time.
Additionally, along with returns due on the maturity period, the individual is also entitled to the interest.
The post office fixed deposit is more popular in the urban areas as compared to the bank deposit schemes.
The fixed deposit rates in post office increase with the number of years you choose to apply for.
POFD is Best Investment options for salaried person & well-preferred by those who are highly conservative with regards to safety and risk of the investment.
At the time, post office fixed deposit schemes can be higher than the rates proffered by the bank.
It is likely, that post office fixed deposit rates will stand somewhere between the bank FD rate and a company FD rate.
So, our today’s topic of discussion is on “Post office FD Interest rates 2020”.
Stay tuned with us till the end to learn about the Post office fixed deposit scheme.
So, without much ado, let’s get started
Features & Benefits of Post Fixed Deposit scheme
- There is no restriction on opening a fixed deposit at the post office. Any individual can open the fixed deposit in the post office.
- You can also assign a nominee name in your post office fixed deposit account. Furthermore, the person whom you nominate can also nominate a person even with an existing post office fixed deposit account.
- The account can be opened through cash or cheque. In government records, the date of realization of the cheque will be taken as the date of opening the account
- There is no limit to the number of the FD accounts that can be opened at the post office
- You can even open a post office FD account in the name of the minor and it will be operated by the legal guardian or parent
- The facility of transfer from one post office to another is made available to you
- The interest rate on post office fixed deposit is quite lucrative and attractive
- The tenure of POFD ranges from 1 year to 5 years
- Depositors can convert the account from single to joint and vice versa
- NRI depositors are not allowed to deposit money in India post office fixed deposit
- In an event of maturity of POFD, the amount gets renewed automatically by the same period it was opened earlier
- The minimum amount you required to start a post office fixed deposit is 200.
- Latest NCD Issue 2020
Post Office Interest Rates Table
|Period||Post Office Interest rates From 01.11.2019|
Note: Interest rates will be revised after every 03 months.
|Post Office Savings Schemes||Interest Rate (From 01.11.2019)|
|Post Office Savings Deposit||4.0 %|
|Post Office 1 Year Time Deposit||6.9 %|
|Post Office 2 Year Time Deposit||6.9 %|
|Post Office 3 Year Time Deposit||6.9 %|
|Post Office 5 Year Time Deposit||7.7 %|
|Post Office 5 Year Recurring Deposit||7.2 %|
|Senior Citizen Saving Scheme (SCSC)||8.6 %|
|Post Office Monthly Income Account||7.6 %|
|National Saving Certificate (NSC)||7.9 %|
|Public Provident Fund (PPF)||7.9 %|
|Kisan Vikas Patra||7.6 % (112 Months)|
|Sukanya Samridhi Scheme||8.4 %|
Why you should opt for Post Office Fixed deposit?
You must well know regarding what is post office fixed deposit and what are the prominent features of it so far. Let’s just now highlight the reasons you consider investing in POFD
- Guaranteed Returns – One of the key reasons that you should consider while investing your hard-earned money in POFD is it assures you of guaranteed returns.
Plus, it is backed by the government of India, and hence regarded as completely safe and secure
- Protection against inflation – Whenever the inflation rate is below the TD rates, The depositor earns more.
- Higher rate of interest – As you all know post office fixed deposit proffer substantial higher rate of interest comparatively. Currently, the rate varies from 6.99% to 7.33%.
- Liquidity – The depositor can withdraw the money prematurity or the depositor can borrow loans against the fixed deposit in an event of an emergency.
- Risk-Free – POFD /Time deposit is absolutely free from risk. The funds once invested complete returns on the maturity whatever be the condition of the market.
- Tax Implications – Under the section 80c of the IT Act, 1961, if a depositor has invested in a 5-year term deposit, one can claim tax deduction up to Rs 1,50,0000.
- Best Bank to Open Savings Account
Where to open POTD account?
Yes, a depositor can open multiple post office time deposits at any of the head office or general post offices.
These accounts can be moved from one post office to another.
The facility makes it easier for those people to invest money in deposit schemes who have to change their residence from time to time due to several reasons.
Documents needed to open POFD account?
What are the documents required for opening a POTD account?
It is very simple to open a post office fixed deposit account.
The depositor can select any post office branch to open a time deposit/ post office fixed deposit
In order to open a Post Office Fixed deposit account, you have to carry the following documents with you
- Address and identity proof such as a copy of passport, driving license, voter ID card, Aadhaar card, ration card, PAN (Permanent account number) or the income tax declaration form 60 or 61 as per the income tax act 1961
- The original copy of the address proof used for opening post office fixed deposit.
What are the processes to open Post Office fixed deposit account?
- A depositor is required to fill up the POFD form provided by the post office
- Then self-attest the copy of the proof provided for verification
- The depositor has to provide the name of a nominee who can withdraw the amount in an event of the death of the investor.
- He has to show the original identity proof for verification at the time of opening the POFD account.
- He also has to get the signature of a witness to complete the formalities and start the deposit.
How to operate the post office term deposit account?
- The depositor has to keep the pay in a slip with the initial deposit opening sum that will be credited into his account.
- He has to pay the amount in cash or cheque.
- At the time of maturity, he can either withdraw the amount or allow the post office to renew the amount of post office fixed deposit again for the same tenure.
The post office fixed deposit rate of interest may be different from the rate at which the previous account was offered.
Interest Rates in Post Office Fixed Deposit (Effective 1st October 2018)
The rate of post office fixed deposit interest rate for POFD is revised by the government at the starting of every quarter of the final year. It is calculated on the basis of yield on government securities.
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About India Post
India post, it is also known as the department of posts, is the postal system managed and operated by the ministry of communication and information technology of the government of technology.
It is the most widely distributed postal system in the world. Taking benefit of a commendable large network, the department has decided to launch a number of saving instruments and banking features in the year 2015 after the in-principle approval if the reserve bank of India.
The core services provided by the post office that consists of delivering the letter, money orders, mails, etc., India post also proffer a fixed deposit in the name of the time deposit schemes.
Under post office saving schemes a number of accounts are offered such as post office savings account, 5 years post office recurring deposit account, Kisan Vikas Patra, and sukanya samridhi accounts.
Frequently Asked question-Post office Fixed Deposit
Q. Can Post office fixed deposit is opened online?
Dear depositors, at present, post office time deposit /Post office fixed deposit can be opened visiting the post office. The depositor has to visit the nearest post office and apply for the post office fixed/time deposit.
The account will get started after the verification procedure of the depositors
Q. Can I transfer my time deposit from one state to another?
The time deposit account opened in one place can be transferred to another place in the same state as well.
For instance, a person who has opened a post office fixed deposit account in Delhi can be transferred to Chennai or Kolkata without any issues.
Q. Can my term deposit be renewed after maturity?
Yes, it will be renewed after maturity if the depositor does not withdraw money after maturity. The amount will be reinvested in the same fixed deposit but at the rate that is effective on the day of maturity
Q. I do not have an Aadhaar card. Can I invest in POTD?
Yes, a depositor requires only one id proof to open the account. He has to submit the attested copy of the identity proof and show the original copy at the time of account verification.
The documents that can be utilized to open the POTD account apart from Aadhaar card are PAN card, Voter ID, Car driving license, passport or the income tax declaration form no.60 or 61 as per the income tax act.
Q. Can NRI benefits from POTDs?
No, only Indian citizens are allowed to open the post office time deposit account.
NRIs are not eligible for post office term deposit.
Q. Do senior citizens get additional interest on post office term deposit?
No. The post office fd rate of interest is similar for both regular as well as a senior citizen.
There are post office saving schemes for senior citizens called “Senior citizen saving scheme” offered by the post office where the rate of interest provided is high on their deposits.
I hope this post regarding the Post office fixed deposit is of great help.
I hope your queries pertaining to the post office fixed deposit scheme is quenched through this article.
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Thanks for reading
I am 45 years old. I have matured FD around 33 lakhin state bank of india. which my father invested the amount three years ago.My father was professor in university.My father has expired on 8th january 2019. Now i want to investing the amount in bank and post office. So kindly suggest me which is better bank or post office for secure my money.
Hello Siddhartha, You can invest your money in SBI Fixed Deposit & Some part around 50% in SBI bluechip fund for better returns in coming years.
plz reply my answer as early as possible
SBI FIXED DEPOSIT RATE NOW 5.10%. HOW CAN I INVEST IN IT. PLZ SUGGEST OTHER OPTION.