Are you looking for a steady stream of income that pays handsomely every month? The Post Office Monthly Income Scheme (POMIS) might be just what you need.
It is a government-supported scheme, making it a safe investment with an attractive interest rate. Currently, the government pays an interest rate of 7.40% per annum on this scheme.
The tenure of the Post Office Monthly Income Scheme is five years. The formula for calculating the monthly income in this scheme is: “Deposit amount x interest rate/12”.
For example:
- If you deposit Rs. 5 lakhs, then the monthly income is Rs. 3,083.33
- For an investment of Rs. 9 lakhs, the monthly income is Rs. 5,550
- If you deposit 15 lakhs, the monthly income will be Rs. 9,250
Who can open a Post Office Monthly Income Scheme?
- Adults can open a single account.
- Two or three people can also open a joint account together.
- A guardian can open an account for a minor or mentally unsound person.
- A minor above ten can also open an account in their name.
Deposit (Minimum & Maximum Deposit)
- The minimum amount to be deposited is 1000 rupees.
- A maximum of Rs. 9 lakhs to 15 lakhs can be deposited in a joint account.
- All account holders have an equal share in the joint account investment.
- An individual can open any MIS account, but the combined deposit/share of all accounts should not exceed nine lakhs.
- The limit differs for accounts taken on behalf of a minor as a guardian.
Payment of Interest
- Interest is paid from the completion of one month from the date of account opening till maturity.
- If the account holder does not claim the interest due every month, then the interest is not compounded.
- If a depositor deposits more than Rs. 9 lakhs, the excess deposit will be refunded, and the savings account interest rate will be paid on it from the date of account opening until the withdrawal date.
- The interest can be auto-credited to the savings account held at the same post office or through ECS.
- Income tax is payable on the interest received by the depositor.
Premature closure of account
- No amount can be withdrawn within 1 year from the date of deposit.
- If the account is closed after one year but within three years from the date of opening, 2% will be deducted from the principal deposit, and the balance will be returned.
- If the account is closed after three years but within five years from the date of account opening, 1% of the original amount will be deducted, and the remaining amount will be paid.
- To close the account, go to the post office, fill out and submit the relevant form, and your account will be closed.
Maturity Amount: The account expires after five years. If you present your passbook at the concerned post office, your money will be returned to you.
If the account holder dies before the account matures, the account can be closed, and the money in that account is paid to the nominee/legal heirs. Interest is also paid for up to a month before the refund is given.