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Discover a financial haven that stands the test of time - the Post Office Monthly Income Scheme (POMIS)! In a world filled with complexities, POMIS emerges as a reliable beacon, offering a steady and secure income stream for prudent investors. This ingenious investment option, offered by trusted postal services, combines convenience and stability to present an ideal choice for those seeking financial peace of mind.

Picture a world where your hard-earned savings generate monthly returns like clockwork, effortlessly adding to your financial well-being. POMIS transforms this dream into reality by providing a guaranteed fixed income - all while shielding you from the volatility of the market.

Whether you're a retiree seeking regular income, a risk-averse investor looking for secure returns, or someone simply wanting to diversify their portfolio, POMIS can certainly be an alluring proposition.

Through this article, we will explore the inner workings of the Post Office Monthly Income Scheme, delving into its features, eligibility criteria, and the steps to invest. Brace yourself for an enlightening journey that will unveil a remarkable investment opportunity that offers both financial stability and the joy of regular earnings.

Features of Post Office Monthly Income Scheme

Here are the key features of the Post Office Monthly Income Scheme (POMIS) -

  • Lock-in Period - You cannot withdraw the money that you deposit into a Monthly Income Scheme (MIS) account before 5 years have passed since you opened the account with the post office.
  • Capital Protection - There is absolutely no possibility of anything going wrong because this is a government-backed scheme. You earn interest each month and your investment is secure with the government. Many people refrain from investing in various programmes because they are unsure of how reliable the plan is. You will not have any such concerns, though, with POMIS.
  • Tenure - Under the Post Office Monthly Income Scheme, you can invest money for 5 years. Once the 5-year period ends, you get the option to withdraw the savings. You can also choose to reinvest the funds in the same scheme or any other scheme. 
  • Minimum Investment Required - You can easily open a Post Office Monthly Income Scheme account with a minimum investment of INR 1,500 and add to this amount as and when required. As far as the maximum limit is concerned, you can invest up to INR 4,50,000. Alternatively, a joint Post Office Monthly Income Scheme account can make a maximum deposit of up to INR 9,00,000. 
  • Low Risk - Unlike equity, market risks do not influence your investments in this Indian Post Office scheme. Simply put, your investments remain secure irrespective of the market conditions. 
  • Assured Returns - Your investment continues to accrue interest every month when you use the Post Office Monthly Income Scheme. The absence of any market hazards on the invested funds is the finest part. As a result, the post office both protects and promotes the growth of your money. With this safety, you may be sure that when you withdraw money, you'll make a significant profit. The POMIS offers better returns than other investment plans like a fixed deposit, which is something to keep in mind.
  • Single or Joint Account - Individuals or groups of people may open a Post Office Monthly Income Scheme account. A key benefit of opening a joint account is that it allows you to invest a substantial amount of money. You can only invest a total of INR 4,50,000 at a time using a single account. However, you are permitted to deposit up to INR 9,00,000 into a joint account. A larger investment promises a greater return.
  • Flexibility in Age - Another benefit of this scheme is that a minor's account can be opened. A minor who is 10 or older can open and manage their own account. The child can change their underage account to an official account once they are 18 years old. With this feature, you can take advantage of early investment and make considerable future savings. Saving money in the minor's name, meanwhile, guarantees their financial security as an adult.
  • Post Office Interest Rates - You can withdraw the interest that accumulates on the investment you make through the Post Office Monthly Income Scheme each month. It can be physically withdrawn from the postal facility or routinely sent to a savings account at a bank. The option to reinvest the funds is also available.
  • Flexibility to Change Post Office - You may move the money you invested from one post office to a different one if you decide to leave your city. The seamless transaction gives you more security and enables you to closely monitor the progress of the investment. 
  • Nominee - You can select a beneficiary with the Post Office Monthly Income Scheme. Thus, in case the initial investor passes away, the beneficiary will be entitled to the savings when they reach maturity.

Benefits of the Post Office Monthly Income Scheme

Investing in the Post Office Monthly Income Scheme has two main advantages. Many investors with a limited tolerance for risk choose it since it is contrary to a market-linked investment plan and is guaranteed by the government. These advantages include -

  • Receiving a consistent monthly income from your investment portfolio, irrespective of market changes. The post office has set an interest rate of up to 7.4% per annum.
  • You can choose to reinvest the interest you earn in high-profit-earning securities like equities shares or equity funds, but these investment choices also carry a significantly higher risk. Hybrid funds, which combine equities funds and fixed-income instruments, make for a practical way to invest in the stock market, build a varied portfolio, achieve larger returns than equity shares and funds, and take on less risk.

Other benefits of this Indian post office scheme include -

  • When using a cheque to open an account, the day the cheque is realised counts as the account opening date.
  • Each account holder in a joint account will have an equal proportion.
  • There is no cap on the quantity of POMIS accounts held separately or jointly (subject to the maximum cumulative balance requirement).
  • A minor may open a Post Office Monthly Income Scheme Account if they are at least 10 years old. They will be required to change their minor account to an adult account upon turning 18.
  • Every month, ECS/CBS transfers the investor's post office savings account's proceeds to the investor.
  • If the investor does not withdraw the proceeds, Post Office Monthly Income Scheme accounts may continue to generate interest for up to two years following account maturity. The interest rate will be the same as a typical Post Office savings account.

Eligibility Criteria for Post Office Monthly Income Scheme

Listed below are the eligibility criteria for participating in the Post Office Monthly Income Scheme -

  • Only an Indian resident can open a Post Office Monthly Income Scheme account.
  • Indians who are not residents are not covered by this system.
  • Anyone who is at least 18 years old may open an account.
  • Anyone 10 years of age or older may have a post office account in the form of a minor account. Children will be able to use the fund once they turn 18 years old.
  • A minor must submit an application for converting the account to their name after attaining the age of adulthood.

Documents Required to be Submitted to Apply for Post Office Monthly Income Scheme

The following are the documents required to be submitted for applying for a Post Office Monthly Income Scheme account -

  • Copies of official identification documents such as a passport, voter ID card, driver's licence, Aadhaar, and so on
  • Government-issued identification or current utility bills are acceptable forms of address proof
  • Passport-size photographs

Current Post Office Scheme Interest Rate

The Ministry of Finance and the Central Government of India set the interest rate for the Post Office Monthly Income Scheme. As per the returns produced by government bonds with a similar duration, the interest rates are frequently altered every quarter. The current Post Office interest rate is 7.4% per annum. 

Procedure to Open Post Office Monthly Income Scheme (POMIS) Account

Opening a Post Office Monthly Income Scheme account is surprisingly easier than you might expect. Instead of imagining tedious queues and extensive paperwork, let's explore the step-by-step procedure that simplifies the entire process.

  • If you currently lack a post office savings account, consider initiating the process to open one.
  • Visit the post office to acquire an application for the Post Office Monthly Income Scheme (POMIS).
  • Complete the application form accurately and submit it at the post office along with a photocopy of your identification, proof of residence, and two passport-sized photographs. Ensure you have the original documents with you for verification purposes.
  • Obtain the necessary signatures of witnesses or nominees on the form.
  • Make the initial deposit payment either in cash or by check. If you are using a check, make sure that it is post-dated with the account opening date.
  • Upon completion of the procedure, the Post Office executive will provide you with the specific details of your newly established account.

How Does the Post Office Monthly Income Scheme Work?

It is easy to comprehend how a Post Office Monthly Income Scheme functions. Your investment will generate interest at a set rate under this arrangement. You can decide to reinvest your earnings in order to amass a substantial sum. The initial investment sum is returned to the investor at the conclusion of the five-year period.

You have two options for taking your investment money out -  either physically at the post office or directly through ECS into your savings account.

You can decide to withdraw the monthly interest each month. As an alternative, you could let it grow and withdraw it after it reaches maturity. Remember that you shouldn't take your first investment money out until the whole period of 5 years has passed.

You would have to pay an administration fee if you withdrew. You have the option to invest the interest further, as was previously explained. You are also allowed to invest the funds through the Post Office Monthly Income Scheme using a recurring deposit. In this manner, the money will continue to accrue interest because it is no longer idle.

Penalties for Early Withdrawal

Check out the penalties for early withdrawal of funds from the Post Office Monthly Income Scheme account -

  • You will not receive any rewards prior to the year's end.
  • Your entire investment will be reimbursed with a 2% fine between 1 and 3 years.
  • The full corpus is repaid with a 1% charge from the fourth to the fifth year.

To know more about the Post Office Monthly Income Scheme, read the following frequently asked questions section.


Q1. Can you change your individual account to a joint account?

Ans: You can change your individual account to a joint account and vice-versa.

Q2. What is the minimum balance that you should maintain in your POMIS account?

Ans: You need to maintain a minimum balance of INR 100.

Q3. How can the beneficiary or the legal heir access the funds of the deceased account holder?

Ans: If a nominee is available, they can submit the death certificate to claim the entitled maturity amount. In the event that no nominee is appointed, the legal heir has the option to make a claim on the estate and receive the applicable benefits.

Q4. Can senior citizens apply for this scheme?

Ans: Indeed, this scheme proves to be advantageous for elderly individuals, as it enables them to place their life savings into the account and generate interest to meet their monthly expenses.

Q5. What to do if you do not want to withdraw the deposit amount once the POMIS account matures?

Ans: If you choose not to withdraw the deposited amount upon maturity, it will remain in the account and accrue simple interest based on the Post Office Savings Account rates for a duration of two years starting from the maturity date of the account.

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