Post Office FD Interest Rates

A Post Office FD can be opened in any post office across India using online and offline methods-

1) Online Method

The Post Office Fixed Deposit account can be opened online by using internet banking-

• One needs to visit the official e-banking portal of the post office at ebanking.indiapost.gov.in.
• For logging in to the portal, use your registered ID and password.
• Click on the ‘Service Request’ under the ‘General Services’ tab.
• Follow the directions present on-screen and click on the ‘New Request’ option to start the Post Office Fixed Deposit opening request.

2) Offline Method

One can visit the nearest India Post branch and collect the form for opening a new Post Office Fixed Deposit account. After submitting the copies of the necessary documents with completely filled-up forms, the post office administrators will guide you regarding the additional directions for the process.

The following people are eligible to operate a Postal fixed deposit- 

• Indian residents can manage such investments, either individually or jointly.
• Minors are eligible for Post Office fixed deposit scheme investments as well, managed by their legal guardian.

NRIs, trusts, companies and other organisations, however, are not allowed to avail fixed deposit investments through Post Office.

Investors must furnish the following documents to deposit in the POTD scheme -  

• Proof of Address

• Telephone bill
• Electricity bill
• Bank statement inclusive of cheque
• Post Office issued ID or certificate
• Passport

• Proof of Identity

• Voter ID
• Pan card
• Aadhaar card
• Driving license
• Photo ration card
• Passport

Moreover, the investor must provide details of a nominee for the FD. A witness must be present when he/she signs the investment papers as well.

The 5-year Post Office FD or National Savings Term Deposit qualifies for a tax deduction under section 80C. It offers a tax deduction of up to Rs 1,50,000 of the deposit.

Note that the post office fixed deposit interest will be taxable for the depositors. The interest is taxable for those taxpayers whose age is less than 60. Although, interest up to Rs 50,000 is entirely exempt from tax for senior citizens above the age of 60.

Loan against FD of India Post Office provides the loan up to 90-95% of the Fixed Deposit amount. The interest charged on loan against FDs are typically low and are around 2-3% higher than the Fixed Deposit interest rate.

An investor can withdraw after six months from the date of deposit. Before this period, no withdrawals can be made.

Note that if an investor makes a premature withdrawal after the expiry of 6 months but before 12 months, then interest will be payable for the completed months.

Any interest already paid to the depositor will be recovered from the deposit repayment amount and the interest payable on the withdrawal amount.