Post Office Monthly Income Scheme

Post Office Monthly Income Scheme is an investment scheme introduced by the Indian Postal service. This small savings scheme allows the investors to set aside a specific amount for five years investment plan. Subsequently, interest is calculated to this investment at the appropriate rate and paid out to the depositors on a monthly basis. Post Office MIS scheme is prevalent among people of rural as well as urban areas, and it grants you a guaranteed return on your investment. In this article, we look at the post office monthly income scheme in detail.

Features of Post Office Monthly Income Scheme

The features of the POMIS are explained below:

POMIS holds the maturity period of the scheme is five years (60 months) from account opening date.
POMIS account can be owned individually or jointly (max. three adult holders).
Minimum Rs. 1500 required for account opening. Higher amounts in multiples of Rs.1500.
On the use of cheque for account opening, date of cheque realisation will be on the time of account opening.
In case of the joint account holder, each account holder will carry an even share.
POMIS includes nominee facility that can be updated after account opening.
POMIS account can be transferred easily from one Post Office to another.
No limit on the number of POMIS accounts held singly/jointly. Subject to the max. Cumulative balance criteria.
Aggregate maximum balance across all solely operated POMIS accounts is Rs. 4.5 lakhs. For joint accounts, the maximum POMIS balance limit is Rs. 9 lakhs.
A minor aged ten years or above can avail the benefits of Post Office Monthly Income Scheme Account. At the age of 18 years, he or she will be asked to convert his/her minor account to an adult account.
The Post office credits proceed directly to the investor’s post office savings account on a monthly basis by ECS/CBS.
Accounts opened before 1st December 2011 were eligible to avail 5% bonus on deposit amount.
Post Office Monthly Income Scheme does not allow any tax rebate on the investments or maturity amount.
Post Office Monthly Income Scheme account will remain to earn interest for up to 2 years after account maturity if the investor does not withdraw proceeds. The appropriate rate will be the same as that of a regular Post Office savings account.

Eligibility Criteria

The applicant applying under this scheme should meet the following eligibility criteria:

The investor should be a resident Indian.
The minimum age limit of the investor should be ten years and above ten years of age.
The maximum fund that a minor can invest is Rs.3,00,000.
The NRI is not eligible to invest in the Post Office Monthly Scheme.

POMIS Interest Rate 2018

MIS account in post office will provide you with an interest rate of 7.3% per annum. The interest rates are fixed annually. Hence, make sure to check the current interest rate of post office monthly income scheme, before opening an account.

Maximum Investment Amount in Post Office MIS

As there is no fixed number of accounts held by the individual, but there is a limit on the maximum amount that can be cumulatively invested across all POMIS accounts.

In the case of a single operating account, maximum investment allowed in POMIS is Rs.4.5 lakhs.
In the case of joint holders (up to 3 joint holders), maximum of Rs.9 lakhs can be invested in POMIS.

Document Required

The prescribed documents are to be furnished along with the application form. Identity Proof: Copy of government-issued Identity card such as Passport /PAN card/ Voter ID card / Driving License/Aadhaar, etc. Address Proof: Copy of government issued ID or recent utility bills. Photographs: Passport size photograph.

How to open MIS in the post office?

The applicant registering for Post Office Monthly Income Scheme has to follow the below mentioned steps. Step 1: The applicant has to approach the nearby post office to collect the Post Office Monthly Income Scheme application form. The POMIS application from is attached below for your quick reference. [pdf-embedder url="https://www.indiafilings.com/learn/wp-content/uploads/2019/01/SB-3.pdf"] Step 2: Now, fill the application form with the required details while providing the nominee details. Step 3: Submit the duly filled POMIS application form along with the required documents to the same post office. Note: Additionally the applicant should carry the original identity proof to post office for verification purpose. Finally, you have to get a witness signature to complete the procedure and to start with the scheme.

Post Office Monthly Income Scheme Online Payment

This online payment facility is currently available for Recurring Deposit in Post Office through Electronic Clearing Service (ECS). Besides, if you hold an agent, he or she can use the post office agent portal and make the online payment. However, details regarding the post office MIS online payment is not nearly exact, so it is recommended to confirm with your post office branch for exact information about this. Moreover, you may also ask your agent for the availability of online payment mode. Moreover, you can automate this scheme very quickly. For availing the scheme benefits, you need to activate a saving bank account and make a request for automatic transfer of monthly income scheme interest to recurring deposit account through your savings account.

Tax Benefit of Post Office Monthly Income Scheme

MIS in post office does not offer any tax benefit. And, the monthly interest payout is taxable income for you. However, there is no TDS on the interest amount.

Premature Withdrawal of the Scheme

In case of premature withdrawal or closure of POMIS account before maturity period (5 years) is allowed to the following terms and conditions:

In case of early withdrawal between 1 to 3 years of account opening, 2% discount on deposit will be applicable.
In case of early withdrawal between 3 to 5 years of account opening, 1% discount on deposit is applicable.