Post Office Time Deposit - Interest Rates, Features & Benefits

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With no maximum restriction on the investment amount and high interest rates, a Post Office Fixed Deposit is a lucrative investment option. The eligibility requirements are simple, and you only need to submit minimal documents to park your funds in a post office FD.

Backed by the Government of India, the post office time deposit account is among the safest investment avenues that assure high returns with flexibility.

Post Office Fixed Deposit Interest Rates

At the start of every quarter of a fiscal year, the Indian Finance Ministry reviews the post office fixed deposit interest rate. The yield on government securities is used to determine the FD interest rates, which typically have a spread over the return in the public sector.

The interest rates for a post office fixed deposit account for 1st July to 30th September 2023 are as follows:

Tenor	Interest Rates (p.a.)
1 Year	7.5%
2 Years	7.5%
3 Years	7.5%
5 Years	7.5%

Disclaimer: These rates are subject to change as per the policy rates set by the concerned bodies.

You can check the previous post office fixed deposit rates on the official website. Remember that the interest rate is revised every quarter, and the interest payout gets disbursed annually.

Features of the Post Office Fixed Deposit

Here are some features you can enjoy upon booking a post office FD:

Easily transfer funds from one post office FD to another
Accounts may be individually or jointly owned
Tenors can be extended once the post office FD has matured
If an account matures without withdrawal, account renewal will be initiated at the same interest rate
No restrictions on how many time deposit accounts you can open
Investors can create POFD accounts at all public sector banks as well as select private banks
Minimum deposit starts at ₹1000 and are only accepted in multiples of ₹100
Interest rates are revised every quarter, and the payment is made annually
Premature withdrawals allowed after six months
Transfer or pledge FD as a security
Nominee facility available for easy transfer to loved ones

Eligibility and Documentation Requirements

The following requirements must be met in order to open a post office fixed deposit:

Anyone above the age of 10
Guardians can open an account on behalf of a minor or person with an unsound mind
After reaching the required age, the minor must submit an application to become the account's owner
Deposits can be owned jointly by up to three persons at a time

You will need to submit the following documents to India Post to start a fixed deposit:

Aadhaar card or Driver’s license
Utility bills or passport
Voter’s ID
Job card
Two Passport-sized photograph

Disclaimer

The information provided by BFDL herein above is related to the Non-Partnered Banks/ NBFCs and is just for the purpose of information and under no circumstances the information provided hereinabove is intended to be source of advice or recommending any financial investment advice or endorsement of any sort

The information including interest rates with regard to fixed deposit, provided on this website is gathered through publicly available sources over the internet and is considered as accurate and reliable to the best of our knowledge. BFDL disclaims any responsibility or liability regarding inaccuracies, omissions, mistakes etc. as well as offers by the Non-Partnered Banks. The use of information set out is entirely at the User’s own risk and User should exercise due care prior taking of any decision, on the basis of information mentioned hereinabove. You are advised to visit/ contact the respective Banks/ NBFCs to verify the information before making any investment or opening an account. Further, BFDL does not undertake any responsibility or liability to update this information. YOU ARE SOLELY RESPONSIBLE FOR ANY LIABILITY OR DAMAGE YOU INCUR THROUGH ACCESS TO OR USE OF THE SITE OR SUCH INFORMATION OR MATERIALS EXCEPT WHERE THE LAWS AND REGULATIONS OF A PARTICULAR JURISDICTION CONCERNING WARRANTIES CANNOT BE WAIVED. Additionally, display of any trademarks, tradenames, logo and other subject matters of intellectual property owners. Display of such Intellectual Property along with the related product information does not imply BFDL’s partnership with the owner of the Intellectual Property of such products.

What is the basic minimum amount to start a POFD?

The basic minimum amount to start a POFD is ₹1,000.

Can I transfer my fixed deposit to another post office?

Yes, you can easily transfer your FD to another post office in India.

Will I get tax benefits if I invest in POFD?

Only deposits with a tenor of five years qualify for tax benefits.

Can a post office fixed deposit be withdrawn before its maturity?

Yes, you can prematurely withdraw your funds from POFD. However, it is possible only after 6 months from the date of booking.

What is the highest interest in a post office fixed deposit?

The highest interest rate you can earn from a post office fixed deposit is 7.5%. These rates are revised every quarter of a fiscal year.

Is there a limit on the maximum invested amount on post office fixed deposits?

There is no limit on the amount that you can deposit or invest in the POFD.

Can I get monthly interest on fixed deposits in the post office?

The interest in a post office fixed deposit is calculated every quarter and payable annually.

How can I make premature withdrawals under POFD?

You can withdraw money from a post office fixed deposit before the tenor ends. If the premature withdrawal happens after 6 months but before 1 year from the date of the account opening, the interest rate applicable would be as of a PO savings account. For premature withdrawals after 1 year, the applicable interest rate is 2% less than the interest rate corresponding to the term for which you invested.

How much TDS is charged on post office FD interest earnings?

Small savings investments at post offices are not subject to Tax Deductions at Source (TDS). However, the interest earned is included in your annual income and taxed according to your slab rate.