| A Post-Office Time Deposit Account (TDA) is a banking service similar to a Bank Fixed Deposit offered by Department of post, Government of India at all post office counters in the country. The scheme is meant for those investors who want to deposit a lump sum of money for a fixed period; say for a minimum period of one year to two years, three years and a maximum period of five years. Investor gets a lump sum (principal + interest) at the maturity of the deposit. Time Deposits scheme return a lower, but safer, growth in investment. |
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| Features |
- Time Deposits can be made for the periods of 1 year, 2 years, 3 years and 5 years. The minimum investment in a post-office Time deposit is Rs 200 and then its multiples and there is no prescribed upper limit on your investment.
- Account may be opened by an individual, Trust, Regimental Fund and Welfare Fund.
- The account can be closed after 6 months but before one year of opening the account. On such closure the amount invested is returned without interest. 2 year, three year and five year accounts can be closed after one year at a discount. They involve a loss in the interest accrued for the time the account has been in operation.
- Interest is payable annually but is calculated on a quarterly basis at the prescribed rates. Post maturity interest will be paid for a maximum period of 24 months at the rate applicable to individual savings account.
- One can take a loan against a time deposit with the balance in your account pledged as security for the loan.
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| Return: |
| This investment option pays annual interest rates between 6.25 and 7.5 per cent, compounded quarterly. Time deposit for 1 year offers a coupon rate of 6.25%, 2-year deposit offers an interest of 6.5%, 3 years is 7.25% while a 5-year Time Deposit offers 7.5% return. |
| Duration of Account |
Quarterly Compound Interest |
| 1year |
6.25% |
| 2 years |
6.5% |
| 3 years |
7.25% |
| 5 years |
7.5% |
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| Advantages: |
| In this scheme your investment grows at a pre- determined rate with no risk involved. With a Government of India-backing, your principal as well as the interest accrued is assured under the scheme. The rate of interest is relatively high compared to the 4.5% annual interest rates provided by banks. Although the amount invested in this scheme is not exempted as per section 88 of Income Tax, the amount of interest earned is tax free under Section 80-L of Income Tax Act. |
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| Please contact us for more information and start an account |
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