Post office savings account is the same thing which keeps your savings money in the Post office just like a normal savings bank account. This post office scheme was initiated by the Indian Government for almost every post office branch across the country.
This deposit scheme provides the saving holders with a good return on their fixed deposits. The Finance Ministry of the Indian Government fixes the rate and the interest rate changes every year and for now the Finance Ministry of the Indian Government currently offers a 5.50% p.a. for a Fixed deposit and 6.70% p.a. for a MIS in a Post office savings account.
Who should open a Post Office Savings Account?
People who are tired of the complex banking process, especially senior citizens and want a convenient and easy way to withdraw or deposit their cash whenever they need it should open a Post office savings account. Generally an adult should open a post office savings account but anyone above the age of 10 years can open their Post office savings account. In such cases the parents of those children will operate their account on behalf of them.
Eligibility, Criteria/Requirements which is required for opening a Post Office Savings Account
- For opening a Post office savings account in India , Indian citizenship is mandatory.
- A minor who’s age is above 10 years can open his or her Post office savings account.
- An individual can only own one single account in a post office branch across all over India.
- For a minor his or her account should be operated by their parents until they are grown up till 18 years.
How can a person open his/her Post office savings account
- To apply for the savings account one have to collect the application form which is easily available in the nearby post office branch or apply through the government websites of India post.
- Then fill up the application form with necessary information and submit it with required self-attested documents like ID proof, Address proof, passport size photo etc .
- After this a successful activation message will be delivered and the Post office savings account is ready to access.
Benefits of owning Post office savings account
Minimal amount of account balance
The minimum amount of money which an individual has to keep in his or her post office savings account is just Rs 500/
Lowest withdrawal policy
The lowest cash which an individual can withdraw is just only Rs 50/-.
Minimum deposit policy
The minimum deposit of Rs 500/- is granted for Post office savings accounts and there is no highest limit for saving money here.
The nominee is a must to add facility for the account holder, so that after the account holder’s demise the account ownership will be transferred to the selected nominee.
Easy account transferation:
The account of an individual can be easily transferred to any branch of India post.
The interest which is gained from the post office savings account are tax free upto Rs 10000/- per annum under Section 80TTA of Income Tax Act,1961
Cons of owning a Post office savings account
- If the minimum account balance descends below Rs 500/- then an amount of Rs 100/- will be deducted from your savings account, which is considered as annual maintenance fees.
- If the account balance becomes zero then your savings account might be automatically closed due to insufficient funds.
How many numbers of accounts can be opened by one single user in one post office?
An individual can only own one single account in a post office branch across all over India.
Can we transfer our Post office savings account to another post office branch?
Yes, the Post office savings account of an individual can be transferred to any branch of India post.
What is the minimum balance which an individual must have to keep in his or her Post office savings account?
A minimum balance of Rs 500/- should be maintained by an individual who owns an account in the Post office. If it is not maintained and the balance descends below Rs 500/- then an annual maintenance charge will be deducted from the account which is Rs 100/-.
Does it provide an ATM card facility?
Yes, the account holders are provided with ATM cards, which can be used in any India Post ATM or from any other ATM near you.
What is the interest rate of fixed deposit and MIS offered to Post office savings account holders?
For fixed deposits an interest rate of 5.50% p.a. and for a MIS plan an interest rate of 6.70% p.a. is offered to an account holder.
Read more Post office and savings related content:
- Fixed Deposit Interest Rates for Senior Citizens in Post Office
- Step-By-Step Guide for Beginners to Open a Savings Account
So it’s now clear what a Post Office Savings Account is, it’s pros and cons, who should Open an Account and how he or she can open an account. I have covered almost all possible points which are necessary to guide an individual who is thinking of opening a savings account in the post office.
The process is quite simple and now it is very convenient to apply for the account since everything is digitalized and the application could be done through normal smartphones. Post office savings account is very helpful for aged people because the transaction process in the post office is much easier and quicker than compared to normal banks.
Krishna Murthy is the senior publisher at Trickyfinance. Krishna Murthy was one of the brilliant students during his college days. He completed his education in MBA (Master of Business Administration), and he is currently managing the all workload for sharing the best banking information over the internet. The main purpose of starting Tricky Finance is to provide all the precious information related to businesses and the banks to his readers.