Interest rates of various Post Office Small Savings schemes in 2021
Post office saving schemes offer several investment instruments, which are safe investment options available for risk-aversive individuals. These are government-backed schemes due to which any individual can invest in these instruments without the fear of losing money.
Post office investment instruments are tax-efficient i.e., these investment instruments get benefit u/s 80C of Income Tax Act. Investment instruments eligible for tax benefit u/s 80C are 5-year Time Deposit (there is no tax benefit on the deposits with less than 5-year tenure), Senior Citizen Saving Scheme, National Saving Scheme, Monthly Income Scheme, Sukanya Samriddhi Account Scheme and Public Provident Fund.
Let’s look at the interest rates applicable on various investment instruments offered by the post office:
|
Instruments
|
Rate of Interest
|
Compounding frequency
|
|
Post Office Savings Account
|
4%
|
Annually
|
|
1 Year Time Deposit
|
5.5%
|
Quarterly
|
|
2 Year Time Deposit
|
5.5%
|
Quarterly
|
|
3 Year Time Deposit
|
5.5%
|
Quarterly
|
|
5 Year Time Deposit
|
6.7%
|
Quarterly
|
|
5 Year Recurring Deposit Scheme
|
5.8%
|
Quarterly
|
|
Senior Citizen Saving Scheme
|
7.4%
|
Quarterly and paid
|
|
Monthly Income Scheme
|
6.6%
|
Monthly and paid
|
|
National Savings Scheme
|
6.8%
|
Annually
|
|
Public Provident Fund
|
7.1%
|
Annually
|
|
Kisan Vikas Patra
|
6.9% (will mature in 124 months)
|
Annually
|
|
Sukanya Samriddhi Account Scheme
|
7.6%
|
Annually
|