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Post Office FD Interest Rates

Post Office FD Rates 2020

Last Updated 23rd Sep 2020

India Post Office is one of most reliable FD providers amongst a number of FD providers in the market. India Post Office FD offers a number of benefits to investors such as higher returns, flexible tenure, lower minimum deposit limit, and loan against FD facility, among others. When it comes to the FD interest rate, the highest rate offered on India Post Office FD is 6.70%. Latest India Post Office FD interest rate for senior citizens, on the other hand ranges between 5.50% to 6.70%.

Tenure FD interest rates Senior Citizen FD interest rates
7 days to 1 year 5.50% 5.50%
1 year 1 day to 2 years 5.50% 5.50%
2 years 1 day to 3 years 5.50% 5.50%
3 years 1 day to 5 years 6.70% 6.70%

Post Office Fixed Deposit (FD)

India Post Office FDs are one the best investment option available for depositors who are looking to invest in a fixed income instrument and earn higher returns than savings account. Key Features of India Post Office FD are:

  • Deposit Amount: India Post Office FD can be opened with an amount as a low ₹ 1,000 to up to No Limit.
  • FD Tenure: Ranges between 7 days to 5 years.
  • Interest Rate Range: 5.50% p.a. to 6.70% p.a.
  • Senior Citizens FD Rate: 5.50% to 6.70% p.a.
  • Highest Interest Rate: As per today’s rate, India Post Office’s highest interest rate on FD is 6.70% offered for a tenure of 5 years.
  • Safety of India Post Office Deposits: India Post Office deposits are covered under the Deposit Insurance Scheme of RBI in which up to ₹ 5 lakh of all deposits of a depositor are insured by DICGC.
  • Loan against FD: India Post Office provides loan against FD to help its depositor meet their liquidity requirements without breaking the FD.
  • Auto Renewal Facility: Available
  • Nomination Facility: Available
  • Popular FD Schemes: National Savings Time Deposit Account

India Post Office Best FD Plan

We need to compare tenure wise latest FD rate of India Post Office to choose the tenure at which it provides the highest interest rate. India Post Office FD rates are best for the deposits with a tenure of 3 years 1 day to 5 years, wherein the current FD rate of interest is 6.70% p.a

If one is looking to invest in short term deposits with India Post Office, FD interest rates range from 5.50% p.a. to 5.50% p.a for deposits with a tenure of 7 days to less than 365 days. These deposits are known as short term deposits as they have a tenure of less than 1 year. Short term India Post Office FD rates for senior citizens range from 5.50% to 5.50% p.a.

If one is looking to invest in long term deposits, India Post Office FD interest rates with tenure of 5 years to 5 years are a good choice with interest rates on deposits with a tenure of 5 years at 6.70%. Senior citizens are offered special rates from bank with highest deposit rates of 6.70% p.a. on long term FDs.

Fixed Deposits of India Post Office have a higher interest rate compared to their saving deposits. Benefits of opening a FD account in India Post Office are:

  • Interest on deposit is paid only at the time of the maturity
  • Nomination facility available
  • Extra interest of 0.25% to 0.50% payable to the senior citizens
  • Availability of auto renewal facility on the deposit
  • Earn higher returns on the money deposited

Documents required to open Fixed Deposit Account in India Post Office

  • KYC documents and Passport size photos

FD in India Post Office – Premature Withdrawal

Premature closure of Term Deposit with India Post Office is along with the lower interest rate of than the contracted rate. The penal provisions for premature closure on India Post Office FD are subject to change from time to time and may also vary with deposit schemes.

Loan against Fixed Deposit India Post Office

India Post Office offers loan up to 0% against its own deposit. Note that India Post Office will not give you loan against FD of any other bank. India Post Office offers Loan against FD at the rate of 6.5% to 7.7%

FD Account Opening Process at India Post Office

To open a Fixed Deposit account in India Post Office, you can visit the official website and login to your account. Choose Fixed Deposit option from the menu and select the Type of FD you want to open and proceed. After this, you have to fill the deposit amount and select ‘Senior Citizen’ option if you are above 60. You have to choose the tenure of deposit and interest payout frequency. Click on Submit to open the India Post Office FD after reading the terms and conditions.

Nomination Facility on India Post Office FD

India Post Office offers nomination facility on Fixed Deposit to claim the amount in case of the death of the depositor. An individual, single or joint account holders can appoint a nominee. Only one person can be appointed as nominee. You can fill nominee details while opening a India Post Office fixed deposit. Nominee has to submit his/her identification proof at the time of claim.

India Post Office Fixed Deposit Scheme

National Savings Time Deposit Account

Description:

  • Department of Post Ministry of Communication Government offers the Post Office Time Deposit Account (TD). It is an investment in which a lump-sum sum amount is deposited at an agreed rate of interest for a fixed period, ranging from 1 month to 5 years. Post Office Time Deposit Account (TD) can be availed at post offices. It helps in generating wealth and saving taxes.
  • Account can be opened by cash or Cheque
  • Nomination facility is available
  • Account can be transferred from one post office to another
  • Minor after attaining the age of 18 years has to apply for conversion of the account in his name.
  • Interest is paid annually
  • Premature withdrawal not allowed before expiry of 6 month, If closed between 6 month to 12 month from date of Opening, Post Office Saving Accounts interest rate will be payable
  • Online Account Opening facility is available
  • The corpus under 5 Years Time Deposits qualifies for the benefit of Section 80C
  • Minimum deposit of Rs. 1000 and in multiple of Rs. 100
  • No maximum limit.

Who is eligible?

  • (i) A single adult (ii) Joint Account (Maximum 3 adults) (iii) Minor above 10 years of age (iv) A guardian on behalf of a minor or Person of unsound mind

FAQs

What is the highest FD rate for India Post Office?

You can earn a maximum interest of 6.70% on India Post Office fixed deposit.

Are there any special rates for senior citizens FD of India Post Office?

Yes, senior citizens get a higher rate on their deposits compared to FD rates. The rate of regular FD are in the range of 5.50% to 6.70%. Compared to this, the rate of senior citizens FD are in the range of 5.50% to 6.70%.

Is there any minimum amount that I have to give for opening a Fixed Deposit with India Post Office?

The minimum deposit amount required to book an FD with India Post Office is ₹ 1,000.

Can I deposit additional amount in my FD account?

No, you cannot deposit any additional amount in your existing FD account as you are allowed to deposit only once at the time of opening the account. If you want to invest any additional amount in FD, you are required to open a new FD account.

Who is eligible for opening an FD account in India Post Office?

All resident individuals, HUFs, NRIs, Firms including minors are eligible to open a fixed deposit account.

What documents are required to open an FD account in India Post Office?

The documents required to open an FD account in India Post Office includes KYC documents and Passport size photos.

Is it possible to change the tenure of my existing fixed deposit account with India Post Office?

No, it is not possible to alter the tenure selected for the fixed deposit account once the account is opened. However, you may close your existing fixed deposit account and can open a new account with a desired tenure of your choice.

What are the implications of opening an FD bank account without having PAN?

Following are the implications for the customers opening an FD account with India Post Office without their PAN card

  • TDS will be deducted at the rate of 20% as against 10% under section 206AA
  • NO TDS credit from the Income Tax department
  • NO TDS certificate will be issued
  • Form 15G/H and other exemption certificates will be invalid and penal TDS will apply

What is the current interest rate on FD in India Post Office?

Current interest for FD in India Post Office ranges between 5.50% - 6.70%.

Can a customer open a FD account online in India Post Office?

Yes, you can submit your application for opening a FD account on the website of India Post Office. After submitting the application, you will be contacted by the bank’s representative for further process which includes filling an application process and submitting KYC documents.

In how many years FD will double in India Post Office?

The interest rate on FD depends upon the tenure you choose. To know the time period in which your FD amount will get doubled, you need to divide 72 with the 6.70%. For India Post Office FD the number of years in which your FD will get doubled is; 72/6.70 = 11


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