About Post Office Monthly Income Scheme Account
Many of you want to invest money to secure your future. And when it comes to hard-earned money, you definitely look for a secure platform. Well, that’s obvious because it is hard to earn money, but if trapped on a wrong platform, it takes a second to lose it all. The good news is that the government has come up with various savings schemes to not only secure your money but also ensure you get good returns out of it. Let’s find out about the Post Office Monthly Income Scheme account in detail, including its eligibility criteria and salient features, among others.
| Scheme | POMIS |
| Investment Period | 5 years |
| Investment Amount | 1k to 9 lakhs (single account) up to 15 lakh (joint account) |
| Interest rate | 7.4% per annum |
| Maturity | 5 years |
The post office offers various savings schemes for Indian citizens. Among these, the Post Office Monthly Income Scheme Account (POMIS) is definitely a good investment option. The aim of this scheme is to provide good returns on the invested amount. As the name suggests, it offers a monthly payout feature where you, as an investor, can receive regular income every month.
Interest rates on Post Office Monthly Income Scheme Account
The interest rates are revised from time to time, however, from January 1, 2024, the interest rate under this POMIS scheme is 7.4% annually, and payable monthly. Interest can be drawn directly through auto credit into savings account of the post office.
This is definitely a good interest rate and at the same time, there is surety of the invested money. However, it is important to mention that this scheme falls under the category of tax deduction under the Income Tax Act. 1961.
How much Money is Required to Open Post Office Monthly Income Scheme Account?
You can open a POMIS account with just one thousand rupees (Rs. 1,000), however, to have high returns, the more amount, the better. There is a maximum investment limit as well, which is 9 lakhs for a single account. However, if you open a joint account, the maximum investment amount limit would go up to 15 lakhs. It is important to note that in the joint account, both the parties will have equal share.
What are the Eligibility Criteria for opening a Post Office Monthly Income Scheme Account?
- Indian Citizens only
- Adult above the age of 18 years
- A minor with guardian
- A minor above 10 years (in his/her own name)
Pre-mature Close of the Post Office Monthly Income Scheme Account
You deposit your hard-earned money to save and grow on a long-term basis, but sometimes life brings a different situation where you need emergency fund. Well, it is important to read the terms and conditions before investing in any savings scheme. The following rules are also associated with POMIS scheme:
- The invested amount shall not be withdrawn before one year or 265 days.
- Account can be close after 1 year. And if the account is closed within 1 to 3 years then there is a penalty of 2% on the investment amount.
- If account is closed after 3 years and before 5 years, then there is a penalty of 1% on the investment amount
- For closing the account, a prescribed application form need to be filled out in the concerned post office.
- After maturity i.e., 5 years, the account can be closed by submitting a prescribed form
- If the account holder dies before maturity, the account can be closed and the amount will be refunded to the nominee or legal heirs. Interests will also be paid up to the preceding month.
How to Apply for a Post Office Monthly Income Scheme Account?
If you’re thinking that applying for a POMIS would be a tedious procedure then you are absolutely wrong. Nowadays, post offices have got tremendous makeover. And they are technologically advanced as well. If you follow the right steps, you can easily open a POMIS account without any hassle at all. So, follow the step-by-step procedure, which are mentioned below:
Step 1: Open a post office savings account if you don’t have any.
Step 2: Download POMIS form online or get it from the post office itself
Step 3: Fill out the form correctly and submit along with a xerox copy of ID, residential proof, and two passport-sized photos at the post office. Please do carry original documents for verification purposes
Step 4: Get signatures of nominees and witness in the application form
Step 5: Deposit the initial amount via cheque or cash
Step 6: After successful processing, the post office officer will provide all the details of your account.
Like authorized banks in India, you can also rely on post offices for investment purposes. Post offices are offering several savings scheme, which are very easy to apply. However, it is always important to read all the terms and conditions before investing. But, it is also true that investing in post office savings schemes is definitely a right step towards growing your savings with time.
Frequently Asked Questions (FAQs)
Q. What is the Post Office Monthly Income Scheme Account (POMIS)?
A. The Post Office Monthly Income Scheme Account (POMIS) is a savings scheme offered by the Indian post office that provides a monthly payout to investors. It aims to provide good returns on the invested amount with a fixed interest rate, ensuring the safety of the invested money.
Q. What is the investment period for POMIS?
A. The investment period for POMIS is 5 years.
Q. How much can I invest in POMIS?
A. You can invest a minimum of ₹1,000 and a maximum of ₹9 lakhs in a single account. For a joint account, the maximum investment limit is ₹15 lakhs.
Q. What is the interest rate for POMIS?
A. As of January 1, 2024, the interest rate for POMIS is 7.4% per annum, payable monthly.
Q. Who is eligible to open a POMIS account?
A. The eligibility criteria for opening a POMIS account are:
– Indian citizens only.
– Adults above the age of 18 years.
– A minor with a guardian.
– A minor above 10 years in his/her own name.
Q. Can I withdraw my money before the maturity period?
A. Yes, you can withdraw your money before the maturity period under certain conditions:
– No withdrawal is allowed before one year.
– If the account is closed after 1 year but before 3 years, a penalty of 2% on the investment amount applies.
– If the account is closed after 3 years but before 5 years, a penalty of 1% on the investment amount applies.
Q. How can I apply for a POMIS account?
A. To apply for a POMIS account, follow these steps:
1. Open a post office savings account if you don’t have one.
2. Download the POMIS form online or get it from the post office.
3. Fill out the form and submit it along with a copy of ID, residential proof, and two passport-sized photos at the post office.
4. Get signatures of nominees and witnesses in the application form.
5. Deposit the initial amount via cheque or cash.
6. After processing, the post office officer will provide the account details.
Q. What happens if the account holder dies before maturity?
A. If the account holder dies before maturity, the account can be closed, and the amount will be refunded to the nominee or legal heirs. Interest will be paid up to the preceding month of closure.
Q. Is the interest earned on POMIS taxable?
A. Yes, the interest earned on POMIS falls under the category of tax deduction under the Income Tax Act, 1961.
Q. Can a POMIS account be opened jointly?
A. Yes, a POMIS account can be opened jointly, and the maximum investment limit for a joint account is ₹15 lakhs. Both parties will have an equal share in the account.