Old Rs500, Rs1,000 notes can be deposited in post office savings accounts: govt

The ministry had on Tuesday said that Rs500 and Rs1,000 notes cannot be used for making deposits in small savings schemes


A post office savings account offers interest of 4% per annum on individual or joint accounts. Photo: AFP
A post office savings account offers interest of 4% per annum on individual or joint accounts. Photo: AFP

New Delhi: People can deposit the banned Rs500 and Rs1,000 denomination currency notes in their post office savings accounts, the finance ministry said on Wednesday.

The ministry had on Tuesday said that Rs500 and Rs1,000 notes cannot be used for making deposits in small savings schemes. “...the deposits into post office savings account are excluded from the bar imposed (on deposits of invalid notes in small saving schemes,” it said while clarifying the Tuesday’s statement.

A post office savings account offers interest of 4% per annum on individual or joint accounts. Such accounts can be opened with an amount as low as Rs20. Minimum balance to be maintained in a non-cheque facility account is Rs50. Cheque facility is available if an account is opened with Rs500 and for this purpose minimum balance of Rs500 in an account is to be maintained.

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After the demonetisation announcement on 8 November, the ministry had received references from banks on whether the invalid high denomination currency notes can be deposited in accounts opened under small saving schemes. To this, the finance ministry said that subscribers of small savings schemes “may not be allowed to deposit old currency note of Rs500 and Rs1,000 in small saving schemes”.

Small saving schemes include post office schemes, public provident fund (PPF) and sukanya samriddhi. Earlier in the day, the RBI through a notification had asked banks not to accept the defunct currency notes for deposits in small saving schemes with immediate effect.

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