Post Office Recurring Deposit Scheme; features, interest rate and more

Opening a post office recurring deposit account could be the perfect way to save money for a certain period of time. Here's everything you need to know about Post Office RD Scheme

Post office has started a 5-year Recurring deposit scheme which is also known as National Saving Recurring Deposit that allows you to save your money on a monthly basis for the period of five years or 60 monthly instalments. This Post Office Recurring Deposit (PORD) scheme is best for those who want to save their money on a monthly basis for a certain period of time. 

What are the features of a Post office recurring deposit account?

Here are the features of a Post office recurring deposit account:

• The minimum instalment to start a post office RD account is Rs 100, and the higher deposit should be in multiples of Rs 10.
• Deposits can be made through cash and cheque and in the case of cheque the date of deposits will be the date of clearance
• The RD account also offers a nomination facility available.
• Rebate available on advance payment of 6 or more RD instalments
• Sole or joint (up to three adults) operation is allowed
• Both Interest and RD are compounded quarterly.
• In case of missed deposits, an individual has to incur a default fee for each month. A default of Rs 1 will be charged for the rs 10 denomination account. 
• Premature closure is allowed after three years
• Premature closure is also allowed after the end of three years. 
• A loan facility is also allowed for up to 50 per cent of the balance credit in the account post after depositing 12 instalments, and the account should continue for 1 year.

Also Read: Govt raises interest rate on 5-year recurring deposit to 6.7% for Dec qtr

What is the interest rate of a Post Office Recurring Deposit?

Currently, the post office's recurring deposit account interest rate is 6.7 per cent (compound quarterly).

What is the eligibility criteria?

Here are the eligibility criteria to open a Post Office Recurring Deposit:

• The individual must be an Indian citizen over 18 years of age who can open the RD account in the Post Office solely or jointly (up to 3 adults). 
• Parent/guardian are also allowed to open a PORD account on behalf of a minor
• A minor above the age of 10 years can open a PORD account in his own name.

Aadhar and PAN are mandatory to open a PORD account

According to a recent notification from the Ministry of Finance, it is mandatory to provide an Aadhar number or PAN number to open an RD account in the post office. If you haven't been assigned an Aadhar number, you need to submit an application for enrollment for an Aadhar card or enrollment ID to open your PORD account.