Salient Features
Rs. 1200/- grows to Rs. 1509/- in five years.
Minimum investment Rs. 500/-
Maximum no limit.
Certificates can be pledged as security against a loan to banks/ financial Institutions.
A Tax saving investment under Sec 80C
Individual or minor can apply
Rate of interest 8.40%p.a. compounded half yearly
Two adults, individuals, and minor through guardian can purchase.
Companies, Trusts, Societies or any other Institutions are not eligible to purchase.
Non-resident Indian/HUF cannot purchase.
No premature encashment.
Annual interest earned is deemed to be reinvested and qualifies for tax rebate for the first 5 years under section 80 C of the Income Tax Act.
Maturity proceeds not drawn are eligible to Post Office Savings Account interest for a maximum period of two years.
Facility of reinvestment on maturity.
Facility of encashment of certificates through banks.
Certificates are encashable at any Post Office in India before maturity by way of transfer to desired Post Office.
Certificates are transferable to any Post office in India.
Certificates are transferable from one person to another person before maturity.
Duplicate certificate can be issued for in case the orginal one gets lost, stolen, destroyed, mutilated or defaced certificate.
Nomination facility is available.
Facility of purchase/payment to the holder of Power of Attorney.
Tax Saving instrument - Rebate admissible under section 80 C of the Income Tax Act.
Deposits are exempt from Wealth Tax.
New type of NSCs with a maturity of 10 years bearing a rate of interest of 8.70% would also be issued.
This reduction in the term from 6 to 5 years means you would have your money locked in for lesser time. If you want to stay invested for longer, you can invest in the 10 year NSCs.
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