Post Office Saving Account

Post office saving account is similar to a savings account in a bank. It is a safe instrument to park those funds, which you might need to liquidate fully or partially at very short notice. Post office savings accounts are especially suited for those living in rural and semi-rural areas where the reach of banks is very limited.

The account can be opened at any post office with a minimum balance of Rs. 20. Maximum of Rs. one lakh for single account holder and Rs. two lakhs for joint account holders can be deposited. There is no lock-in or maturity period. The amount can be withdrawn anytime subject to keeping a minimum balance of Rs. 50 in simple account and Rs. 500 for cheque facility accounts.

Rate of interest is decided by the Central Government from time to time. Interest is calculated on monthly balances and credited annually. Income tax relief is available on the amount of interest under the provisions of section 80L of Income Tax Act.