Post Office Savings Account can be opened for just Rs 500 and offers 4% annual interest. It is more profitable than government and private banks. Tax deduction up to Rs 10,000 is available.
A common citizen earns a living by doing jobs and businesses and also saves from them. He tries to save from the remaining amount after meeting his expenses. Sometimes, he cannot invest the money because he wants it to be in hand, and if he keeps that money in a savings account, he does not get any interest.
Many people are in this situation. Then a person looks for a savings account that gives more interest than that. If you are also looking for such a bank account, your search can end after reading this news. The post office department, which is colloquially called the postal department, provides banking facilities and offers higher interest rates than private banks.
Open an account with just Rs 500.
Only Rs 500 is required to open a savings account in the post office. Because by paying Rs 500, you can open a new post office savings account and the minimum balance of that account is the same. Another advantage of this is that it is relatively easy to maintain the minimum balance of Rs 500, no matter how much you spend.
Along with this account, modern facilities like cheque book, ATM card, e-banking and mobile banking are also available. Also, you can avail government schemes through Aadhaar linking. The balance in the Post Office Savings Account earns an annual interest of 4.0%, which is higher than that of major government and private banks.
Better alternative than banks
In India, there are different terms and conditions for the minimum balance required to open a savings account in government and private banks. While in government banks, the minimum balance is required to be maintained between Rs 1,000 and Rs 3,000, in private banks, this minimum amount can be between Rs 5,000 and Rs 10,000. Also, if we consider the interest rate, in government banks, the annual interest rate is 2.70% and in private banks, it is 3.00% to 3.50%, which is lower than the post office rates.
Income tax deduction:
Interest earned on a Post Office Savings Account is eligible for tax deduction up to Rs 10,000 under Section 80TTA of the Income Tax Act. Also, the Post Bank account is operated by the government, so it is safe. Any adult Indian can open a Post Office Savings Account. Both can open a joint account. Children below the age of 18 can open an account and their parents or guardians can handle it. In short, any adult Indian can open a savings account in the Post Office.
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