Benefits of Small Saving Schemes in India

by Cashiya Finance Finance & Loans | India

Small savings schemes are designed to provide safe and attractive investment options to the public and at the same time to mobilise resources for development.


These schemes are operated post offices and public sector banks throughout the country. Some of the schemes are listed below with their detailed features & benefits:


Post Office Monthly Income Scheme (MIS)


  • Interest rate of 7.5% per annum payable monthly w.e.f. 01-07-2017
  • Maturity period is 5 years.
  • No tax deduction at source (TDS).
  • No tax rebate is applicable.
  • Minimum investment amount is Rs.1500/- or in multiple thereafter.
  • Maximum amount is Rs. 4.50 lakhs in a single account and Rs.9 lakhs in a joint account.



National Savings Certificate (NSC)


  • NSC VIII Issue (5 years) – Interest rate of 7.8% per annum
  • No maximum limit for investment.
  • No Tax deduction at source.
  • Deposits qualify for tax rebate under Sec. 80C of IT Act.


Public Provident Fund (PPF)

Small Saving Schemes with Benefits

  • Interest rate of 7.9% per annum w.e.f. 01-04-2017.
  • Minimum deposit is 500/- per annum. Maximum deposit is Rs. 1,50,000/- per annum
  • Deposits can be made in lump-sum or in 12 installments.
  • Maturity period is 15 years but the same can be extended within one year of maturity for further 5 years and so on.
  • Deposits qualify for deduction from income under Sec. 80C of IT Act.
  • Interest is completely tax-free.



Post Office Time Deposit Scheme

 Small Saving Schemes with Benefits

  • Time deposit scheme is available for 1 year, 2 year, 3 year and 5 year.
  • Interest payable annually but compounded quarterly:


1 Year        6.8%

2 Years       6.9%

3 Years       7.1%

5 Years       7.6%

  • Minimum amount of deposit is Rs 200/- and in multiples of Rs 200/- thereafter. No maximum limit.
  • Investment up to Rs 1,50,000/- per annum qualifies for Income Tax Rebate under section 80C of IT Act.
  • Interest income is taxable.


Senior Citizen’s Savings Scheme (SCSS)


  • Interest @ 8.4% per annum from the date of deposit on quarterly basis w.e.f. 01-04-2017
  • Minimum deposit is Rs 1000 and multiples thereof. Maximum limit of 15 lakhs.
  • TDS is deducted at source on interest if the interest amount is more than INR 10,000/- p.a.
  • Maturity period is 5 years.
  • Investment under this scheme qualifies for the benefit of Section 80C of the Income Tax Act, 1961 from 1.4.2007.


Post Office Savings Account :

Small Saving Schemes with Benefits 

  • Rate of interest 4.0% per annum
  • Minimum amount for account opening Rs 20.
  • Maximum balance permissible is Rs 1,00,000/- in a single account and Rs 2,00,000/- in a joint account.
  • Interest is tax free up to INR 10,000/- per year from financial year 2012-13.


Kisan Vikas Patra (KVP)

Small Saving Schemes with Benefits

  • Rate of Interest 7.5%.
  • Minimum deposit is Rs 1,000. No Maximum limit for deposit.
  • Amount Invested matures in 115 months.
  • Certificate can be encash after 2 & 1/2 years from the date of issue.

About Cashiya Finance Senior     Finance & Loans | India

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Joined APSense since, March 4th, 2017, From gurgaon, India.

Created on Feb 6th 2018 06:25. Viewed 260 times.


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