Post Office FD Interest Rates - Latest Rates & Schemes 2024 | Bajaj Finance (2024)

Post Office Fixed Deposit interest rates 2024

The Government of India (every quarter) decides post office fixed deposit interest rates under ‘Small Saving Schemes’. These rates are, in turn, determined as per the performance of government securities/ bills. A post office fixed deposit with a tenure of 5 years has an interest rate mark-up of 25 bps over the yield of comparable government securities.

Note:All interest rates shown below are as on 1 January 2024. Interest rates from 1 January 2024 to 31 March 2024. The below table shows the updated post office FD interest rates for 2024 (January 1, 2024, to March 31, 2024)

If you open a fixed deposit with the post office for a tenure of 5 years, you will be eligible to claim tax benefits under Section 80C of the Income Tax Act, 1961.

Here is a comparison of the latest FD interest rates post offices against those offered by Bajaj Finance Limited.

Senior citizens can get additional rate benefits of up to 0.40% p.a. Check the return you will get on Bajaj Finance Fixed Deposit with an FD interest calculator.

How to invest in Post Office FD?

You can invest in Post Office Fixed Deposit (FD) using either of the following methods:

Online Method:

1. Download the India Post Mobile Banking app from Google Play Store.
2. Log in to the app using your credentials.
3. Click on the ‘Requests’ tab.
4. Select ‘Open POFD Account’.
5. Fill in the required details and submit the application.

Offline Method:

1. Visit your nearest Post Office branch.
2. Collect the Post Office FD application form.
3. Fill in the required details and attach the necessary documents.
4. Submit the application form along with the deposit amount.

Eligibility to Open a Post Office FD Account

Here are the eligibility criteria to open a Post Office Fixed Deposit (FD) account:

• Any Individual.
• A minor above 10 years of age on his/her name.
• A guardian on behalf of a minor or a person of unsound mind.
• NRIs, trusts, companies are not allowed to open post office FD account.

Documents Required to Open Post Office FD

To open a Post Office Fixed Deposit (FD) account, you will need to provide the following documents:

• Proof of Identity:Aadhaar card, Voter ID Card, PAN Card, Driving License, Passport, etc.
• Proof of Address:Aadhaar card, Utility bills (such as electricity bill, water bill), Ration Card, etc.

Types of Post Office FD Schemes

1.National Savings Time Deposit Account

National Savings Time Deposit Account is a fixed deposit scheme offered by the Indian Post Office. It is designed for investors looking for a secure investment avenue with guaranteed returns. Here are the key features of this scheme:

• Tenure Options:This scheme offers flexible tenure options, typically ranging from 1 year to 5 years. Investors can choose the tenure that best aligns with their financial goals.
• Interest Rates:The interest rates for National Savings Time Deposit Accounts are set by the government and are subject to periodic revisions. The rates are competitive and often similar to those offered by banks for their fixed deposits.
• Interest Payment:Interest on a Post Office Fixed Deposit account is credited annually but compounded quarterly. If the account holder does not withdraw the interest on the due date, no further interest is added to the interest amount.
• Premature Withdrawal:Any deposit in a Post Office Fixed Deposit account can only be withdrawn after a minimum of 6 months from the deposit date. The following conditions apply for account closure:
  • If a 1-year Post Office Fixed Deposit account is closed after 6 months, the applicable interest rate will be the same as that of a Post Office savings account.
  • If a 2, 3, or 5-year Post Office Fixed Deposit account is closed after 1 year, the interest rate will be reduced by 2% compared to the Post Office Fixed Deposit rate for the completed years. For the period less than a year, the interest rate applicable will be that of a Post Office savings account.
• Minimum and Maximum Investment:The minimum deposit amount for opening a National Savings Time Deposit Account is just Rs. 1,000 which is quite low, making it accessible to a wide range of investors. There is no maximum investment limit.
• Tax Benefits:The 5-year Post Office FD scheme offers tax benefits under Section 80C of the Income Tax Act, enabling investors to claim deductions for their investments up to a certain limit.

2.National Savings Monthly Income Account

The National Savings Monthly Income Account is another popular post office FD scheme designed for individuals seeking regular monthly income. Here are its key features:

• Investment Limit:Under this scheme, an account can be opened with a minimum deposit amount of just Rs. 1,000. The maximum deposit limit is Rs 4.5 lakh for an individual account and Rs 9 lakh for a joint account. In the case of an account opened by a guardian on behalf of a minor, the limit will be distinct.
• Interest Payment:Interest is disbursed at the conclusion of each month starting from the account opening date and continuing until maturity. If the depositor does not claim the due interest at the end of a month, no additional interest will be accrued on the unclaimed interest amount. It's important to note that the interest income is subject to taxation for the depositor.
• Tenure:The tenure for the National Savings Monthly Income Account is generally set at 5 years. Investors can choose to extend the account after maturity for an additional 5 years.
• Premature Withdrawal:Any deposit in the National Savings Monthly Income Account can only be withdrawn after 1 year from the date of deposit. The following conditions apply for account closure:
  • If the account is closed after 1 year but before 3 years from the account opening date, 2% of the deposit amount will be deducted.
  • If the account is closed after 3 years but before 5 years from the account opening date, 1% of the deposit amount will be deducted.
• In summary, the National Savings Time Deposit Account and the National Savings Monthly Income Account are two significant post office FD schemes that offer safety, regular income, and competitive interest rates. Investors should carefully assess their financial goals and needs to determine which of these schemes aligns best with their investment objectives.

Features and benefits of Bajaj Finance Fixed Deposit

Here is a table of the features and benefits offered by Bajaj Finance.

Post Office FD: TDS implication/ taxation

One significant benefit of investing in post office FD is that (TDS*) isn't deducted on the interest earned.

While documentingIncome Tax Return(ITR), one can add their investments of fixed deposit in post office to claim deduction u/s 80C of the Income Tax Act, 1961. The upper limit for deductions under the said section of the IT Act, 1961 is maxed at Rs. 1.5 lakh, every financial year.

Post office fixed deposit vs Bajaj Finance Fixed Deposit

Suppose you are thinking of redirecting the interest earned from the post office FD. In that case, you can consider an alternative option of investing in high-yielding companies that offer similar guarantees with zero to low risk on FD.

Even though post office FD may offer a higher interest rate than bank FD, it cannot match the interest rate provided bycompany FDs. You can ensure maximum returns on FDs guaranteed by well-financed and liquid companies like Bajaj Finance. Let us see how you can benefit even further with a Bajaj Finance FD.

• Investment rate –Bajaj Finance FD offers higher interest ratesof up to8.85% p.a., which is higher than any other fixed-income option given the current state of the economy. A post office FD will allow a maximum of up to 7.50% p.a., which can be further reduced if the government securities (G-sec) yield falls.
• Flexibility –Bajaj Finance FD offers flexible terms for premature withdrawal (compared to post office FD). It also provides an option to avail of loan against FD at a marginal interest rate.
• Ease of access –While a post office FD may not offer you many online features, you can easily invest in a Bajaj Finance online FD that enables you to reap the benefit of an end-to-end online paperless procedure. Additional features of doorstep document pickup, multi-deposit, and auto-renewal make it even more convenient. You can open a Bajaj Finance online FD account by just using a debit card at a few locations.

Bajaj Finance also accepts deposits from NRIs and is rated high on the safety and stability ranking, making it one of the best investment options for those with a lower risk appetite. To help you compare the features of post office fixed deposit and Bajaj Finance Fixed Deposit, here is a table detailing the differences between the two:

With a total deposit book size of more than 50000 crores, you can trustBajaj Finance FD to give you maximum returnsat little to no risk.

Calculate your expected investment returns with the help of our investment calculators