A Post Office Savings Account is one of the most popular and accessible savings accounts in India.
- The minimum opening amount as well as maximum balance that can be retained is Rs. 500.
- The interest rate being offered for this account is 4.00% p.a.
It can also be opened by a minor above the age of 10 in their own name.
Only one account can be opened as a single account by the individual. There is no limit on the maximum amount that can be deposited in a post office savings account.
It is also eligible for tax exemption for interest of up to Rs. 10,000 earned in a financial year (for all savings accounts combined) under the Income Tax Act. 80TTA.
The following individuals are eligible to open a Post Office savings account
- Minors with a minimum age often years.
- A guardian on behalf of a minor.
- A person of unsound mind.
- Two or three adults can open a joint account.
- Group Accounts, Institutional Accounts and other accounts like Security Deposit Accounts & Official Capacity Accounts are not permissible.
Cheque facility is available and can be request for existing accounts as well.
- Account holders who have maintained the prescribed minimum balance on the day of issuance of the debit card. CBS Post Offices can grant ATM/Debit cards.
- Customers can make withdrawals and deposits through any electronic mode in CBS Post offices.
In order to keep the account active, you only need to carry out one transaction of a deposit or withdrawal in 3 financial years. The account will not be deemed inactive unless there are no transactions for 3 financial years.
Two or three adults are allowed to hold an account together under the joint account facility. A single account can be convened to a joint account and vice versa.
The account holder can also choose to nominate a person to receive the proceeds of this account after their demise at any time.
Post Office savings account interest rate is decided by the Central Government from time to time and is generally between 3% to 4%. Interest is calculated on monthly balances and credited annually.