The Post Office Savings Account is a deposit program administered by the Indian government that can be accessed at any post office nationwide. The Reserve Bank of India sets the fixed interest rate at which it will yield returns on your investment (RBI). If you want to start saving small and earn set returns on your investment with little risk, opening a savings account under the Post Office Savings Scheme can be helpful. A post office savings account can be opened to receive interest at a rate of 4% per year.
Features of Post Office Savings Account
The following are a Post Office savings account’s primary features:
- You have the option to terminate the account whenever you’d like.
- Accounts can be operated by minors who are older than ten.
- A minimum of one deposit or withdrawal must be made once every three years to maintain the account’s activity.
- Only cash can be used to open the account.
- The option to nominate someone is available both when opening an account and afterward.
- Up to Rs 10,000 in interest can be earned without paying taxes.
- Under the terms of section 80L of the Income Tax Act, there is an income tax reduction on the amount of interest.
- It is possible to move the account between post offices.
- It is possible to convert single accounts to joint accounts and vice versa.
- In CBS Post offices, deposits and withdrawals can be made using any electronic method.
- ATMs are a means to conduct transactions.
Post Office Savings Account Benefits
The ability to open these accounts with checks and ATMs is available to customers. Below is a list of some alluring advantages of Post Office Savings Accounts:
Cheque facility: For accounts that already have an account, a check facility request is also accepted.
ATM/Debit card: CBS Post Offices may provide ATM/Debit cards to account holders who have kept the required minimum amount on the day the card was issued.
Accounts for Minors: Minors may open a Post Office Savings Account. If a juvenile is younger than ten years old, they can open an account in their name, but their parent or guardian will have the authority to manage the account on their behalf. Accounts can be operated independently by minors who are 10 years of age or older.
Portability: You can move your Post Office Savings Account to any branch of your choosing if you change jobs, are dissatisfied with the services provided by the Post Office branch, or for any other reason. In a single post office, only one account may be opened.
Nomination: These accounts allow you to nominate someone when you first register an account. The beneficiary designated by the account holder to receive the account’s proceeds in the case of their death may be changed at any time..
Joint Holdings: Two or three adults may hold an account jointly under the terms of the joint account facility. It is possible to convert both a single and a joint account.
Tax Exemptions: Under the joint account function, up to three persons may hold an account jointly. It is possible to change an individual account into a joint account and vice versa.
Electronic Facilities: At CBS Post offices, customers are able to make deposits and withdrawals using any type of electronic device.
A long time of inactivity: To keep the account active, you just need to make one deposit or withdrawal every three fiscal years. The account won’t be deemed dormant until three financial years have passed without any activity.
Post Office Savings Account – Eligibility Criteria
Anyone of the following people is qualified to create a Post Office savings account:
- Minors who are at least ten years old
- A guardian acting on behalf of a child under ten years old
- A mentally unstable person
- A joint account can be opened by two or three persons.
- It is not permitted to have group accounts, institutional accounts, or other kinds of accounts including official capacity accounts and security deposit accounts.
Documents Required to Open a Post Office Savings Account
- Post Office Savings Account Opening Application Form
- KYC Form
- PAN Card
- Aadhaar Card/ Passport/ Driving License/ Voter’s Card/ MNREGA job card/ letter issued by National Population Register
How to Open a Post Office Savings Account
To open a post office savings account, simply follow these easy steps.
- Get the application by going to the India Post website or your local post office.
- Provide the necessary information in the form.
- Provide a passport-sized photo together with the necessary documentation.
- Make a deposit payment (it must be at least Rs. 20).
- You must make a deposit of at least Rs. 50 in order to open a post office savings account without a checkbook. One of the main features of a Post Office savings account is that there are no lock-in or maturity dates. Opening an account of this type is very easy because one can simply walk into any post office, complete the necessary paperwork with the clerk, and create an account immediately.
New Service Charges on Post Office Savings
Recall that there are additional service fees if you wish to open a post office savings plan:
- Duplicate checkbook issuance: Rs. 50
- Deposit receipt issuance costs Rs. 20 per receipt.
- Account statements are issued at a cost of Rs. 20 per.
- Change of nomination or cancellation: Rs. 50
- Issuing passbooks in place of damaged or missing certificates cost Rs. 10 per registration.
- No cost will be assessed for up to 10 leaves when issuing a checkbook in a savings account within a fiscal year. (After that, each cheque leaf is Rs. 2).
- Rs. 100 is required for both account transfers and account pledges.
- Dishonour cost for checks: Rs. 100.