×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

One-minute guide to understanding PO monthly income scheme

One-minute guide to understanding PO monthly income scheme
Comment E-mail Print Share
First Published: Mon, Apr 19 2010. 08 58 PM IST

Updated: Mon, Apr 19 2010. 08 58 PM IST
0-15 seconds
What am I?
Called a post office monthly income scheme, I give assured returns. I am a debt instrument provided by the government of India. You’ll find me at post offices.
15-30 seconds
How do I work?
I pay an interest rate of 8% per annum, which is payable monthly. I mature after six years. So, if you deposit Rs1 lakh in me today, I will give you a monthly income of Rs666 for six years. On maturity, you will get back your Rs1 lakh and a bonus. You can invest a maximum of Rs4.5 lakh in an individual account and Rs9 lakh in a joint account in the denominations of Rs1,500. You can withdraw me prematurely after a year. If you do so before three years, 2% will be deducted from your total deposit. After three years, 1% would be deducted.
30-45 seconds
Who can buy me?
I can be opened by an individual, jointly by two or three adults, and a minor through a guardian. In fact, a minor who has turned 10 can open an account in his own name. I work best for retired employees or senior citizens, who have a lump sum in the form of provident fund or other savings to invest and want regular income.
45-60 seconds
Red flags about me
Post offices have not been known for best customer services. While things are improving with computerization, not all post offices are computerized yet.
Comment E-mail Print Share
First Published: Mon, Apr 19 2010. 08 58 PM IST