Fixed Deposit Rates in Post Office


India is a nation with a diversified population in terms of wealth and poverty. With numerous options of financial institutions to put our money into, There are Post Offices set up by our government.Unlike most of the banks whose rules and regulations fluctuate from place to place, Post Offices are the uniform bodies which follow the same set of rules all across the country. Let us dive in for some more detailed information regarding the same in maintaining Fixed Deposit Accounts and Fixed deposit rates in Post Office.


What do you understand about a Fixed Deposit?


Fixed Deposit refers to the investment made by a person of a particular amount of money for a fixed period of time at fixed rate of interest. It is beneficial in terms that idle money can be deposited in, and extra amount can be earned on that idle money as interest through a fixed rate. In this elaborate discussion we also shall be discussing Post Office Fixed Deposit Rates.


What is a Fixed Deposit Account?


Like Recurring Deposit accounts are opened in financial institutions, Fixed Deposit accounts are also opened similarly, where deposit is made for a fixed period of time at predetermined rate of interest.


Post Offices as Financial Institutions 

Post offices are the most traditional and by far the largest banking system operating in our country serving investment needs of both urban and rural clientele.These financial services are provided as agency services to government as well as common people.Fixed Deposit Rates in Post Office are made while keeping in mind the economic conditions of an average Indian man.

  • The characteristics of post office fixed deposits
  • The government supports Time Deposits of the Post Office.
    • Suitable for people who are conservative and have a low risk profile in terms of credit worthiness.
  • Only Indian Citizens are eligible to open a fixed account in Post Office, no NRI can come forward to do the same.
  • 1000 with no maximum limit should be the minimum amounts necessary to open the account.
  • You can create a set of fixed postal accounts, convert an account into a joint account, etc.
  • You can open a minor’s fixed deposit account that can be handled by a legal guardian.
  • The facility of nomination is also allowed in post offices where account holders can nominate a person as his/her nominee as well as the latter can nominate another person for the same account.
  • Tax deduction is allowed under section 80C while filing the return to the government.
  • Under certain terms and conditions applied you can withdraw your sum before reaching maturity. However, you can renew the same for the same period of time.
  • Any interest received by a senior citizen is exempt under section 80 TTB, upto Rs.50000.
  • Fixed Deposit Rates in Post Office are more attractive than Banks FD Rates.

 Fixed Deposit in a Post Office

  • Investment Tenure

Time deposits or fixed deposits can be made in one, two, three and five years for postal services.

  • Minimum Deposit Amount

Minimum deposit required for opening this account in Post Office is Rs.1000 while there is no limit on maximum amount for the same.

  • Payment Mode 

Payment can be made to the post office in terms of cash, cheque or online transfer.

  • Interest calculation and Withdrawal Before Maturity

Interest iscalculated on a quarterly basis while payable on an annual basis. Withdrawal only if the account is opened for six months. Cash cancellation only.

Tax Benefits on Post Office Fixed Deposit

 Only applicable for the deposits made under the tenure of five years, and not any other.

Fixed Deposit Rates in Post Office 2021

The following are the latest post office Fd rates as per the schedule declared by the Government of India.These are recorded as of May 2021.

Investment Tenure(years) Rate of Interest
1 5.50%
2 5.50%
3 5.50%
5 6.70%


Benefits of Post Office Fixed Deposits

  • Tax Deducted at Source is not chargeable and exempt from tax.
  • Easy money transferring from one account to another account.
  • Multiple FD accounts can be opened with the same account holder’s name.
  • Attractive FD rates in post office.
  • Very reasonable and nominal sum is required to operate the account in a post office.
  • Joint Fixed Account is allowed for upto 3 members in the Post Office.

Documents Required for Opening Post Office FD

The following documentation is required all across the country for opening Fixed Deposit accounts in any post office.

  1. Identity Proof- AadharCard,Voters ID, PAN Card or any such issued by government of India.
  2. Address Proof- Any such document like electricity bill, aadharcard,ration card, that can authenticate your residence is required to be carried.
  3. PAN Card.
  4. Two photographs compulsorily to be carried along with.


How to Apply for Opening a Fixed Account in a Post Office

 You can apply in a post office for opening fixed deposit accounts in both online as well as offline manner.

  1. Online Mode

STEP 1- Visit the official site of the banking facility portal provided by the post office through

STEP 2- Use your registered ID and Password to login into the portal.

STEP 3- Follow the on screen instructions and go on ‘NEW REQUEST’

for initiating the process towards Post Office Time Deposits.

  1. Offline Mode

Alternatively, you can also visit the nearest Post Office and collect the form, fill the same with all the asked details and submit.

You also have to submit the copy of all the documents mentioned above. They may require you to hand in two sets of photocopies, as is the case in most of the government offices.

The official present there then will guide you with further instructions.

Terms and Conditions for withdrawing before Maturity Period 

  • Such premature withdrawal of money is acceptable and allowed only after the completion of six months from the date of opening Fixed Deposit Account in Post Office. Before the completion of the mentioned tenure anywhere between one to Five years is, a person cannot ask for any withdrawal of money even after having the ownership of the same.
  • The rate of interest applicable on the amount withdrawn will be at par with the rate of Post Office Savings Accounts rate, whenever the withdrawal is made anywhere between six months to twelve months.
  • For investment schemes with tenure two years and above, 1% reduction in proposed dividend is made before disbursing the amount to account holders.

 Post Office FD Special Forms

 In order to avail tax benefit and get exemption on income upto Rs.40000,investors need to fill the form 15G and 15H(uptoRs. 50000) for general and senior citizens respectively.

  • Failure in filling these forms and their submission will lead to surrender of exemption from TDS of Fixed Deposits.

Loans against Post Office Fixed Deposits

Account holders raise loans against the value of Fixed Deposit held by him/her in the Post Office. Apart from being an emergency source of funding,such loans come with reasonable rates of interest which proves to be very less burden on the loan tasking party.


Fixed deposit rates in Post Office are a largely used banking system by both rural as well as urban people because of its safety being backed up by the government and also due to its attractive rates of interest. It is beneficial for a common man in terms of the amount required for investment and also the returns earned on the same.Facility of Fixed Deposits in Post Office has surely proven to be a boon to our economy as otherwise the cash that would have been idle,is now injected by the owners into the economy by means of investment in such deposits with the idea of earning profits in terms if interest.

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