Post Office Monthly Income Scheme (POMIS) is a savings scheme officered by the post offices across the country. This savings scheme is guaranteed by the Government of India. As the name suggests, it is a saving scheme in which a definite amount of money is invested, and interest is earned on a monthly basis.
Let us learn about the Post Office Monthly Income Scheme (POMIS) scheme
1. What is the eligibility to invest in the Post Office Monthly Income Scheme (POMIS)?
To invest in POMIS, an investor should be a permanent resident of India. Non-residents Indians(NRIs) are allowed to invest in the scheme.
A joint account can also be opened under the scheme. Minors above the age of 10 years can also open the account. This account can also be opened by A guardian on behalf of a minor/Person of unsound mind.
After attaining the majority minor has to apply for conversion of the account in his name by submitting KYC documents.
2. Post office interest rates and how it is paid?
The present rate of interest in Post office interest Rates is 6.60% which is effective from 01st April 2020. This Interest rate is changed every quarter and is decided by the central Govt. However, the offered interest rate is guaranteed as it is backed by the Govt. of India.
|2019 – 20||6.60%|
|2018 – 19||7.30%||7.30%||7.70%||7.70%|
|2017 – 18||7.60%||7.50%||7.50%||7.30%|
*Rates subject to change as per government notification. Interest payout on POMIS occurs monthly.
The highest interest ever offered was 14% for 5 years POMIS from 24th April 1992 to 1st Sep 1993.
|Time Period||Interest Rate|
|15 Aug 1987 to 23 April 1992||12.00%|
|24 April 1992 to 1 Sep 1993||14.00%|
|2 Sep 1993 to 31 Dec 1998||13.00%|
|1 Jan 1999 to 14 Jan 2000||12.00%|
|15 Jan 2000 to 28 Feb 2001||11.00%|
|1 March 2001 to 28 Feb 2002||9.50%|
|1 March 2002 to 28 Feb 2003||9.00%|
|1 March 2003 to 30 Nov 2011||8.00%|
|1 Dec 2011 to 31 March 2012||8.20%|
|1 April 2012 to 31 March 2013||8.50%|
Interest accrued is paid on a monthly basis to the savings account of the account holder. Interest is paid to account holder on completion of 1 month from the date of deposit.
3. What is the amount which can be invested in POMIS?
The minimum amount to start investing in POMIS is Rs. 1500 (via cash or cheque) and in multiples of Rs. 1000/- thereafter. The maximum investment limit for a single account is Rs. 4.50 lakhs and for joints account(maximum three adults) is Rs. 9.00 lakhs. An individual can invest a maximum of Rs. 4.50 lakhs, including his share in the joint accounts also. In the case of a joint account, each applicant will have an equal share.
4. What is the tenure of the deposit?
The deposit has a lock-in period of 5 years from the date of deposit. Premature withdrawal is allowed only after completion of 1 year. If the withdrawal is happening after one year and before three years a penalty of 2% will be levied on deposit amount and if the withdrawal is after three years then a penalty of 1 % is levied on the deposit amount.
5. Who should invest in POMIS?
POMIS is ideally suited for investors who are looking for long term safe and secure monthly returns from their investment. As the deposited and interest are guaranteed, this scheme is an excellent investment option for investors looking for safety and who are unwilling to take any risks. Therefore it can be a good investment avenue for retired individuals and senior citizens.
6. How to open a POMIS account?
Post office Monthly Income Scheme account can be opened at any post office across the country. For opening this account documents for Identity proof, and address proof along with Photographs are required to be submitted.
7. Other features of POMIS account
- No TDS is deducted from the interest payable on a monthly basis. However, interest income is not exempted from income tax and is taxable in the hands of the investor.
- Investment in POMIS does not offer any Income tax rebate under section 80(C) of the Income-tax Act 1961.
- There is no limit for the number of accounts held by any individual, but the cumulative invested amount should not exceed Rs. 4.50 lakhs.
- POMIS accounts can be transferred from one post office to another.
- Nomination facility is available in the accounts.
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