Post Office Savings Schemes are becoming quite popular in India these days owing to their attractive interest rates and safe returns. Just like a bank, you can also open a fixed deposits (FD) account at a post office for different tenures from one year to five years.
Post office fixed deposits, also called Post Office Time Deposits (POTD) have different interest rates for different tenures.
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Recently, the government increased the interest rates of the time deposit scheme by 30 basis points. Now under this scheme, an investor is being given an interest of up to 7 per cent per annum. The most important thing is that in this scheme, the investor is given the opportunity to make both short-term and long-term investments.
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In the scheme, the option of investing from 1 year to 5 years is open. If you simply deposit Rs 1 lakh in lump sum for 5 years, not only will you get good returns on maturity, but you can also claim tax exemption under section 80C of the Income Tax Act.
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Any Indian citizen can open an account under the post office time deposit scheme. In fact, 3 adults together can also open a joint account. Parents can also open a time deposit account in the name of their children above 10 years of age. An account can also be opened by investing only Rs 1,000 under this scheme.
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Different interest rates have been fixed for different periods of investment in the post office time deposit scheme. If an investor deposits money in this scheme for 5 years, then they will get an interest at the rate of 7 per cent per annum. On making a time deposit of three years, the investor will be given an interest at the rate of 6.9 per cent. Similarly, a 6.8 per cent interest is being given on a 2-year time deposit. The lowest interest i.e. 6.6 per cent interest is given on a one-year time deposit.
