Post Office Monthly Income Scheme: Interest Rate & Features

The Post Office Monthly Income Scheme allows you to invest a certain amount and earn a predetermined rate of interest each month. As the name implies, you may invest in this at your local post office. In this post, we will discuss many facets of this plan, such as qualifying requirements, interest rates, and so on.

The Post Office Monthly Income Program (POMIS) is a modest savings scheme supported by the Government of India that allows investors to save a specified amount each month. Following then, interest at the relevant rate is added to the investment and handed to the depositor(s) every month

Also read Post Office Investments – PPF, NSC, FD, RD, MIS, KVP, SSY.

Requirement for Post Office Monthly Income Scheme

Post Office Monthly Income Scheme is open to the following individuals:

• An Indian national. This plan is not open to non-resident Indians.
• Individuals above the age of ten

Read more Saving Schemes in India.

Who should invest in the Post Office Monthly Income Scheme?

• Investors who desire an investment with an assured monthly income and zero risks. It is advantageous for retirees or seniors who have reached the point of no return.
• An investment for investors who want a set income to fund the cycle of life.
• Investors are interested in making long-term investments.

Maximum Investment in Post Office Monthly Income Scheme?

Though there is no restriction to the number of accounts a person can hold, there are limits to the total amount that can be invested across all POMIS accounts.

• The highest investment allowed in POMIS for a solely run account is Rs.4.5 lakhs.
• A maximum of Rs.9 lakhs can be invested in POMIS by joint holders (up to 3 joint holders).

Current Post Office Monthly Income Scheme Interest Rates?

The Central Government and Finance Ministry fix and adjust the rate of interest every quarter based on the returns on government bonds of the same duration. POMIS has an interest rate of 6.70% from October to December 2022.

Period	Annual Post Office MIS Interest Rate
1st July 2022 – 30th September 2022	6.60%
1st April 2022 – 30th June 2022	6.60%
1st April 2021 – 31st December 2021	6.60%
1st April 2018 – 30th June 2018	7.3%
1st January 2018 – 31st March 2018	7.3%
1st October 2017 – 31st December 2017	7.5%
1st July 2017 – 30th September 2017	7.5%
1st April 2017 – 30th June 2017	7.6%

Interest rates are subject to alteration upon notice from the government. POMIS interest is paid out weekly.

The Post Office Monthly Income Scheme’s Features

The following are the essential elements of the Post Office MIS plan:

• Maturity Duration – As of December 1, 2011, the scheme’s period of maturity is five years or sixty months from the account’s official opening.
• Holders of Account – POMIS accounts can be owned either individually or jointly (maximum three adult holders)
• Maximum and Minimum  amounts of deposit – The minimum deposit amount in the Post Office MIS plan is Rs. 1,000. (and thereafter in multiples of 1,000)

The maximum deposit amount in the Post Office Monthly Income Scheme

Account Type	Maximum Limit
Single Account	Rs. 4.5 L
Joint Account	Rs. 9 L
Minor Account	Rs. 3 L

• Nomination Option – A nominee facility is offered and may be altered later once a beneficiary opens an account (i.e. a family member). But, the successor can only collect the rewards after the account holder’s death.
• Account Transfer – POMIS accounts can be directly moved from one PO to the other.
• Incentive – There is no bonus available for accounts created on or after December 1st, 2011. Accounts opened before were entitled to a 5% deposit incentive.
• Tax – This scheme is subjected to taxation and is not under Section 80C of the IT Act. Also, it has zero TDS.

Additional Advantages of the Post Office Monthly Income Scheme

• When using a check to create an account, the cheque realization date is the account opening date.
• In the event of joint accounts, every account holder will have equal portions.
• There is no restriction on the number of POMIS accounts that can be held individually or jointly. Subject to the cumulative balance maximum criterion
• The Post Office Monthly Income Scheme Account is available to minors aged 10 and up. When he or she reaches the age of 18, he or she will be invited to switch his or her underage account to an adult one.
• The post office CBS or ECS deposits credit monthly directly into the investor’s savings account post office.
• Post Office Monthly Income Scheme accounts can keep producing interest for up to two years after maturity if the investor does not remove the money. The relevant interest rate will be equivalent to that of a regular Post Office savings account.

Necessary Documentation for Post Office Monthly Income Scheme

• A copy of an ID issued by the government, like an Indian Voter Identification card, passport, Aadhaar card, or driver’s license.
• An ID issued by the government or current utility bills.
• Passport-sized photos

How Do I Create a Post Office Monthly Income Scheme Account?

Follow the procedures below to create an account under the Post Office Monthly Income Scheme.

• You should have savings account from the post office. If none, make one.
• Purchase an application form at your local PO. You can also download the POMIS Account Application Form.
• Fill out the form and bring it to the post office with self-attested copies of all relevant papers. Please keep in mind that you must bring the original documents for verification.
• If any, mention the names, phone numbers, and DOB of nominees.
• Proceed to make your first cash or cheque deposits (The lowest amount is Rs.1000/-).

Post Office Monthly Income Scheme Calculation

After creating an account, you must invest. The min. investment for one account is Rs. 1k while the max. investment is Rs. 4.5 lacs

The min. investment for joint accounts is Rs.1k while the max. investment is Rs.9 lacs.

As an illustration: Raj makes an Rs.1,000,000 investment with a five-year maturing period. A 6.60 percent interest rate annually, monthly income (fixed) is Rs. 550. Raj will also reap the funds deposited after the scheme’s tenure.

What sets Post Office Monthly Income Scheme apart from other monthly income schemes?

POMIS	Mutual Funds Monthly Income Plan	Insurance Monthly Income Plan
Monthly income plan with 6.70 percent interest -Fixed	A mutual fund that is debt-oriented and invests in 20 percent debt and 80 percent equities.	A retirement account in which the investor gets an annuity as monthly payments.
Monthly income assurance	There is no certainty of monthly income because the returns are linked to the fund’s market performance.	Monthly income that is set and assured
TDS is not applied, however, the interest gets taxed	Inapplicable TDS	Monthly annuities are taxed.
Ideal for risk-averse individuals seeking monthly income rather than equity investments.	Ideal for investors with a medium risk tolerance looking for debt and equity assets.	Ideal for investors who want to get the benefits of both insurance and investing.
The highest investment amount is Rs.4.5 lacs (one account) and Rs.9 lacs ( combined account)	The quantity of investment is not restricted.	Absence of max. amount.
Fixed returns at 8.5%	There are no guaranteed returns.	Rather than collecting earnings, this strategy focuses on safeguarding money.

Premature Post Office Monthly Income Scheme Withdrawal

Premature withdrawal or closing of a POMIS account before maturing(Five years period) is permitted subject to the following rules and conditions:

• In the event of an early withdrawal during the first three years after account inception, a 2% ‘deduction on deposit’ is applied.
• Early withdrawals between 3 and 5 years after account opening are subject to a 1% deduction on deposit.

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