Post Office Monthly Income Scheme (MIS) Features and Interest Rates 2025

Post Office Monthly Income Scheme (POMIS)

Backed by the Government of India; Post Office schemes are widely accepted as some of the safest options to save some money and even get interest on it. And when we talk about saving money with getting interest, what can be better than Post Office Monthly Income Scheme, right?

Offered by India Post, Monthly Income Scheme (MIS) pays interest each month to the account holder. It is an apt scheme for those who want a regular income from their investments. You can open an MIS account at any post office near your home.

Post Office Monthly Income Scheme (MIS) Interest Rate 2025

The rate of interest offered on the POMIS is 6.60% per annum for a period of 5 years. The rate of interest is announced each quarter. There is no special interest rate paid to senior citizens. Senior citizens can invest their money in the Senior Citizens Savings Scheme (SCSS) which offers an interest of 7.4% currently. To check the amount of money that you will get on a monthly basis out of the POMI scheme, you can even use the Post Office Monthly Income Scheme calculator. This calculator is an online tool and can be found easily on the internet.

Eligibility Criteria to Open a POMIS Account 

Who is eligible?	Only Indian citizens are eligible to open a POMIS account
Are NRIs eligible?	No, NRIs cannot apply for the scheme
Are Minors eligible?	Only adults can open a POMIS account. Adults can open accounts on behalf of minors of 10 years and above. Once a minor is 18 years old, he/she can apply for conversion of the account
What is the minimum deposit allowed?	Single account – INR 9 lakh Joint account – INR 15 lakh Minor account – INR 3 lakh

 

Process to open a POMIS Account

Opening a POMIS account is hassle-free if you follow the step-by-step procedure given below:

• The first step is to open a post office savings account (if you don’t have one)
• To open an account, go to the post office and get a POMIS application form
• Duly fill out the form and submit it together with copies of your ID and address proofs
• Also, you need 2 passport-size photos
• Also, don’t forget to carry the original documents for verification
• You will require the signatures of your nominee(s) on the form
• Pay the initial deposit amount with a cheque or cash
• The form will be proceeded further for processing. Once it is done, you will receive the details of your account

What are the consequences of withdrawing early?

• If you withdraw your POMIS before the completion of one year, you will not receive any benefits.
• If you withdraw your account between 1st and 3rd year of account opening, you will get the account refunded with a deduction of 2% as penalty
• If you withdraw the account between 3rd to 5th year of opening the account, the entire corpus will be refunded with a 1% penalty

Who should invest in POMIS?

POMIS serves the best purpose of risk-averse people. These are flexible and reliable plans that are available with limited tax benefits.

POMIS Interest Rate – Past 5 Years

Time interval	POMIS interest rate (per year)
1st April 2023 – 30th June 2023	7.40%
1st January 2023 – 31st March 2023	7.10%
1st October 2022 – 31st December 2022	7.10%
1st April 2020 – 30th September 2020	6.60%
1st January 2020 – 31st March 2020	7.60%
1st October 2019 – 31st December 2019	7.60%
1st July 2019 – 30th September 2019	7.60%
1st January 2019 – 31st March 2019	7.70%
1st October 2018 – 31st December 2018	7.70%
1st January 2018 – 30th September 2018	7.30%

 

Features of Post Office Monthly Income Scheme

While you are considering the Post Office Monthly Income Scheme, you must be aware of the features as well.

1. Low risk

The risk factor comes to all of our minds, whoever considers investing money. You would be glad to know that POMIS is an investment with minimal or no risk, making it the safest option for investment. The account holder gets monthly payouts as returns.

2. Regular payments

Investors get regular monthly interest payments.

3. Lock-in period

The POMIS comes with a 5-years lock-in period. Once the 5-years lock-in period is over, you can choose to reinvest in the scheme, if you wish to.

4. Number of accounts

You can open more than one account to avail of the benefits of this scheme. But there is a limit to how much one can invest in all the accounts as a collective balance . The maximum cumulative balance for all the single accounts is INR 4.5 lakh, and for all the joint accounts, it is INR 9 lakh.

5. Single account and joint account

You can either hold an individual account or a joint account. However, you have to be a resident of India and your age should be more than 10 years. In a joint account, a maximum of three adults can be there and each of them will have an equal share of the account.

6. The lowest and highest investment

The minimum amount of money that you can invest to open a Post Office Monthly Income Scheme account is INR 1500. After that, you can invest multiples of INR 1500. Individuals can make a maximum investment of INR 4.5 lakh and not more than that.

7. Minor

Even a minor can open a POMIS account; however, the minimum age has to be 10 years and not below than that. The ceiling amount that can be invested by a minor is INR 3 lakh. Once the minor is 18 years old, he/she will be able to transform the account into an adult account.

8. Maturity

Once the account is matured, you can withdraw the money or choose to reinvest it into the scheme again. If you have neither withdrawn the money nor reinvested it, the account will keep earning interest for a period of 2 years from the date of maturity at the interest rate applicable for post office savings account.

9. Premature withdrawal

Although you will be able to avail premature withdrawal if your account is more than an year old; you may have to pay a penalty. If the account holder is withdrawing the amount before five years, the penalty is charged. The penalty is charged on the basis of the redemption time. Only 1% as a penalty is levied for the premature withdrawal after three years. If you withdraw the money in between one and three years, the penalty levied will be 2% .

10. Auto withdrawal of interest

The most convenient part is that the returns are automatically transferred to the savings account that the account is linked to through Electronic Clearing System (ECS) and Post Dated Cheque (PDC).

11. Transferable

You can transfer your POMIS account from one Post Office to another.

12. Tax

In the POMIS interest amount, TDS is not deducted. Nevertheless, you need to know that the interest that you earn on the POMIS scheme is certainly taxable. Under Section 80C of the Income Tax Act, the investment is not eligible for tax savings.

Major Differences Between Post Office MIS Scheme, Fixed Deposit and Mutual Funds

While you are considering POMIS, you must not confuse it with the other monthly income plans. For more clarity, here are some differences between Post Office MIS Scheme, Fixed Deposit and Mutual Funds.

Post Office MIS scheme	Fixed Deposit	Mutual Funds
The rate of interest offered is fixed at a given rate	The interest rate is fixed	The rate of return may change and it completely depends on market stability
Returns are guaranteed	Returns are assured	Returns are not always guaranteed
No TDS	TDS is applicable	No TDS
The investment limit is applicable	No limit	No limit
No risk	No risk	Moderate to high risk
Premature withdrawal is allowed but with a penalty	Premature withdrawal is allowed but is subject to a penalty	A minimum lock-in period is applied with 3 years for SIP

Apart from this, you will also come across several insurance policies that can help you get the benefit of saving money along with the additional feature of life insurance. You can visit several websites to find the right life insurance policy for yourself and your family.