Post Office Savings Accounts

Post office savings accounts are offered by the Indian post office as their savings and investment schemes. Adults can have a savings account with the post office and can enjoy a number of facilities.

A single individual or two-three individuals of minimum of 18 years of age can open a savings account in the post office. The savings accounts can be opened in any post office. The various types of individuals or organization that can have POSA account in post office are:

A local body or authority can have Public Account

Pensioner can have account to receive or credit the monthly pension

Provident Fund, Gratuity Fund or Superannuation Fund can open Group Accounts

A university; a contractor, an employee or an agent of government can open savings account for security amount deposits.

• For the payment of leave, pay salary or pension contribution of the government servants who are on deputation, the cooperative bank or cooperative society can open accounts.
• An officer or a gazetted officer of corporation, Government or Reserve Bank of India or a local authority can have account in the official capacity.

The post office savings accounts can be opened with a minimum amount of Rs.20. The maximum amount that can be deposited is one lakh in case of a single account holder and two lakhs for joint holders. If a depositor is having more than one account, then the maximum balance taking all the accounts together cannot surpass the amount of one lakh.

No fixed maturity period or duration is associated with the POSA accounts. The account holders can withdraw any amount from the account provided to keep a minimum balance of Rs.50 for the simple accounts and Rs.500 for the accounts with check facility. The rate of interest offered with the POSA accounts is 3.5 per cent per annum. The depositors are given a pass book that is regularly stamped by the post office on every transaction. The accounts that are not in operation for three years are treated as silent account. Until the day of its reactivation, a service charge of Rs.20 is charged per year. After the deductions of service charge each year, if the balance of an account becomes zero, then the account is closed automatically. An income tax relief under section 80L of Income Tax Act is available on the interest amount of the account.