Post Office FD 2026 — Latest Interest Rates Q1 FY 2026–27, Tax & How to Open
Post Office Small Savings 2026: Q1 FY 2026–27 rates — POTD 6.9–7.5%, SCSS 8.2%, PPF 7.1%, NSC 7.7%, KVP 7.5%, MIS 7.4%, RD 6.7%, SSY 8.2%. How to open, tax and renewal.
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Quick summary. Post Office Small Savings Schemes are sovereign-backed savings instruments operated by India Post under the Ministry of Finance. Q1 FY 2026–27 rates (notified 28 March 2026): Post Office Time Deposit (POTD) 6.9–7.5%, SCSS (Senior Citizens Savings) 8.2%, PPF 7.1%, NSC 7.7%, Kisan Vikas Patra (KVP) 7.5%, POMIS (Monthly Income Scheme) 7.4%, 5-year RD 6.7%, SSY 8.2%. Open at any post office with PAN + Aadhaar. Top tax-shielded picks for FY 2026–27: SCSS (₹30 lakh limit, 80C eligible, quarterly interest payout) and PPF (₹1.5 lakh annual, fully tax-free under EEE).
The Government of India revises small-savings rates quarterly based on the Shyamala Gopinath formula — pegging each scheme’s rate to a benchmark G-Sec yield with a small spread. For Q1 FY 2026–27 (April–June 2026), the Finance Ministry held all rates unchanged for the fifth consecutive quarter — reflecting stable yield expectations. Most rates have been at their current levels since Q1 FY 2024–25.
The combination of government guarantee + relatively high rates + tax shields makes post-office schemes among the most efficient debt-side allocations for conservative savers. SCSS, PPF, and SSY are EEE (entirely tax-free); NSC and POTD give 80C deduction; POMIS gives monthly cash flow without 80C.
Q1 FY 2026–27 rates — at a glance
| Scheme | Rate | Tenure | Min / Max investment | Tax shield |
|---|---|---|---|---|
| POTD 1-year | 6.9% | 1 year | ₹1,000 / no max | None |
| POTD 2-year | 7.0% | 2 years | ₹1,000 / no max | None |
| POTD 3-year | 7.1% | 3 years | ₹1,000 / no max | None |
| POTD 5-year (Tax Saver) | 7.5% | 5 years | ₹1,000 / ₹1.5 lakh | 80C eligible |
| 5-year RD | 6.7% | 5 years | ₹100/month / no max | None |
| PPF | 7.1% | 15 years (extendable in 5-year blocks) | ₹500 / ₹1.5 lakh per FY | EEE — 80C + tax-free interest + tax-free maturity |
| NSC VIII Issue | 7.7% | 5 years | ₹1,000 / no max | 80C + interest re-investable for 80C |
| SCSS (Senior Citizens 60+) | 8.2% | 5 years (extendable in 3-year blocks) | ₹1,000 / ₹30 lakh | 80C + quarterly interest payout |
| POMIS | 7.4% | 5 years | ₹1,000 / ₹9 lakh single, ₹15 lakh joint | None |
| Kisan Vikas Patra (KVP) | 7.5% | ~115 months (money doubles) | ₹1,000 / no max | None |
| Sukanya Samriddhi (SSY) | 8.2% | Until girl turns 21 | ₹250 / ₹1.5 lakh per FY | EEE |
Which scheme suits whom?
| Saver profile | Best pick | Why |
|---|---|---|
| Senior citizen 60+ wanting high regular income | SCSS | 8.2% quarterly payout + 80C; ₹30 lakh limit doubled in 2023 |
| Long-term tax-free wealth builder | PPF | 7.1% EEE for 15 years; partial withdrawal after 7 years |
| Parent of girl child below 10 | SSY | 8.2% EEE for ~21 years; one of the highest tax-free rates |
| Conservative saver wanting 80C + steady rate | NSC VIII or 5-year POTD | 7.7% / 7.5% with 80C deduction |
| Retired person needing monthly cash flow | POMIS | 7.4% paid every month; ₹9 lakh single / ₹15 lakh joint cap |
| Salaried young saver — just an emergency parking | POTD 1-year | 6.9% liquid; auto-renewable |
Detailed scheme rules
Senior Citizens Savings Scheme (SCSS)
- Who: Indian residents aged 60+ (or 55+ for retired Defence personnel; 50+ for retired civil servants).
- Limit: ₹30 lakh per individual (raised from ₹15 lakh in Budget 2023).
- Tenure: 5 years; extendable in 3-year blocks for one more time.
- Interest: 8.2% p.a., paid quarterly to the same post-office / bank account.
- Tax: Investment qualifies for 80C (up to ₹1.5 lakh of total 80C cap). Interest is fully taxable as Other Income; TDS @ 10% above ₹50,000 annual interest.
- Premature closure: Allowed after 1 year with penalty (1% to 1.5% of deposit).
Public Provident Fund (PPF)
- Who: Any Indian resident; one account per person (additional minor account by parent).
- Limit: ₹500 minimum; ₹1.5 lakh max per FY.
- Tenure: 15 years; extendable in 5-year blocks indefinitely.
- Interest: 7.1% p.a., compounded annually.
- Tax: EEE — contribution is 80C-eligible (Old Regime); interest fully tax-free; maturity tax-free.
- Loan: Available between Year 3 and Year 6 — up to 25% of balance. Loan interest 1% above PPF rate.
- Partial withdrawal: From Year 7 — up to 50% of preceding-year balance.
National Savings Certificate (NSC VIII Issue)
- Who: Any Indian resident; cannot open a joint with NRI or HUF.
- Limit: ₹1,000 minimum, no maximum — but only ₹1.5 lakh total qualifies for 80C.
- Tenure: 5 years (lock-in).
- Interest: 7.7% p.a., compounded annually, paid at maturity.
- Tax: Contribution is 80C-eligible. Interest is taxable but deemed re-invested for 80C in years 1–4 (effectively recycling the deduction). Year-5 interest is fully taxable.
Post Office Monthly Income Scheme (POMIS)
- Who: Any Indian resident; can be opened single or joint (up to 3 holders).
- Limit: ₹1,000 minimum; ₹9 lakh max (single) / ₹15 lakh max (joint).
- Tenure: 5 years.
- Interest: 7.4% p.a., paid monthly to a savings account.
- Tax: No 80C; interest fully taxable.
- Premature closure: Allowed after 1 year (small penalty 1–2%).
Sukanya Samriddhi Yojana (SSY)
Covered in detail in our separate SSY 2026 article. 8.2% rate, EEE tax treatment, until girl turns 21.
Documents required to open
While filling online form
- Aadhaar card (mandatory)
- PAN card (mandatory if investment exceeds ₹50,000)
- Recent passport-size photograph
- Address proof (utility bill / Aadhaar / passport)
- Initial deposit cheque / cash
- Nomination form (Form SB-1) — strongly recommended
- For SCSS — proof of age (PAN / Aadhaar / Passport / 10th certificate)
- For SSY — birth certificate of girl child
How to open an account
- Visit your nearest post office (any branch — 1.55 lakh post offices nationwide).
- Ask for the relevant Account Opening Form (SB-3 for POTD, NSC-1 for NSC, SCSS-1 for SCSS, etc.).
- Fill: personal details, scheme details, nominee, initial deposit.
- Attach documents (self-attested copies + originals for verification).
- Pay the initial deposit (cash up to ₹50,000, cheque for higher).
- Receive a passbook + account number on the spot.
India Post Payments Bank (IPPB) lets you operate most post-office accounts via mobile after opening — including PPF, SSY contributions, FD opening, RD instalments. Download the IPPB app from Play Store / App Store.
⏰ Last Date: Open (rolling — no deadline)
Visit India Post savings pageClicking this button will take you to the official government portal.
Tax-deduction summary
| Scheme | 80C deduction (up to ₹1.5 lakh) | Interest taxability |
|---|---|---|
| SCSS | ✅ | Fully taxable + TDS above ₹50,000 |
| PPF | ✅ | Tax-free |
| NSC VIII | ✅ | Taxable; year 1–4 re-invested for 80C |
| 5-year POTD | ✅ | Fully taxable |
| SSY | ✅ | Tax-free |
| POMIS | ❌ | Fully taxable |
| KVP | ❌ | Fully taxable |
| 1/2/3-year POTD | ❌ | Fully taxable |
| 5-year RD | ❌ | Fully taxable |
Frequently asked questions
1. What is the highest interest small-savings scheme in 2026?
2. Are small-savings rates fixed for the entire tenure?
3. Is the SCSS limit really ₹30 lakh?
4. How much PPF contribution gives 80C deduction?
5. Can NRIs invest in post-office schemes?
6. How do I open an SCSS account from a different city?
7. Are there any digital alternatives to visiting a post office?
8. What happens after PPF matures?
Latest updates
The Finance Ministry held all small-savings rates unchanged for Q1 FY 2026–27 in its 28 March 2026 notification — the fifth consecutive quarter of stable rates. IPPB Mobile Banking 2.0, launched January 2026, allows direct fund-transfer to PPF / SSY accounts via UPI Auto-pay. The 2026 budget did not alter the SCSS ₹30 lakh cap or the PPF / SSY annual contribution limits. Post-office fixed deposits crossed ₹15 lakh crore in cumulative deposits in March 2026.
Official links
Disclaimer. SarkariBaba is an independent information publisher. Small-savings rates are revised quarterly — verify on nsiindia.gov.in for the prevailing rate before opening or extending an account.
