Post Office Monthly Income Scheme (POMIS) in 2024

The Post Office Monthly Income Scheme (POMIS) is a government-backed savings scheme that provides a secure and convenient way for an investor to generate a regular monthly income from this investment at high-interest rates. The PO-MIS is an appealing option for those seeking financial stability and income generation while living abroad. In this brief guide, we will explore the key features and benefits of the POMIS.

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Disclaimer: #The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.

About PO-MIS

The full form of PO-MIS is the Post Office Monthly Income Scheme. It is a popular investment option offered by the Postal Department of India that aims to provide an investor with a regular and guaranteed monthly income.

An individual can invest their money in the PO-MIS scheme and receive a fixed monthly income in the form of interest payments.

The Post Office Monthly Income Scheme is a convenient and risk-free investment plan that helps an investor to park their funds and receive consistent returns.

Key Features of PO-MIS (Post Office Monthly Income Scheme)

The key features of the Post Office Monthly Income Scheme (POMIS) are listed in the table below:

Features	Details
Launched By	Department of Posts, Government of India (GoI)
PO-MIS Interest Rates for NRI/OCI/PIO	Quarterly interest rates (decided by Ministry of Finance, GoI) 7.4% p.a. for April – June quarter Unclaimed monthly interest does not accrue additional interest
Account Type	Single Account Joint Account Minor Account
Minimum Investment Limit	Rs. 1,000 (thereof, in multiples of Rs. 1,000)
Maximum Investment Limit	For Single Account: Rs. 9 lakhs For Joint Account: Rs. 15 lakhs (equal share for both individuals) For Minor Account: Rs. 3 lakhs
Maturity Period	Minimum 5 years
Monthly Income Payouts	Your payouts will be made on a monthly basis, but not at the beginning of each month. You will continue to earn interest on your investment until it matures.
Auto-Credit Facility	You can receive interest through auto-credit to your savings account at the same post office or via Electronic Clearance Services (ECS). You can also invest the earned interest in a Recurring Deposit (RD) account to earn more returns.
Nomination Facility	Available
Taxation	Interest earned from POMIS is taxed as per your income tax slab. No tax deductions on your investment made in POMIS under Section 80C of the Income Tax Act, 1961. No TDS will be deducted from the interest income or on the maturity of the POMIS.

Eligibility Criteria to Invest in PO-MIS (Post Office Monthly Income Scheme)

To start investing in the Post Office Monthly Income Scheme (PO-MIS), an applicant must fulfil the following eligibility criteria:

Citizenship: The applicant must be a resident Indian
Age: The applicant must be at least 18 years old.
No Maximum Age Limit: There is no upper age limit to invest in PO-MIS.
Minor Account: One can open a PO-MIS account on behalf of the minor who is at least above 10 years of age.
Joint Account: Investors can open a single or joint account. In a joint account, all account holders must be resident Indians.

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7.5% ^(TAX-FREE)

Returns After Tax

7.5%

Guaranteed Returns

Yes

Life Cover

Yes

Tax on Profit

Tax Free*

Risk

No Risk

Still Better than FD’s and Debt Mutual Fund

Fixed Deposits

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7% ^(TAXABLE)

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Guaranteed Returns

Yes

Life Cover

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Risk

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Debt Mutual Fund

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8% ^(TAXABLE)

Returns After Tax

5.5%

Guaranteed Returns

Life Cover

Tax on Profit

Taxable

Risk

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Documents Required to Open a PO-MIS Account

The following documents are required for an applicant to open a PO-MIS account in the post office:

Document	Description
Identity proof	Any government-issued ID such as: PAN card Aadhaar card Voter ID card
Address proof	Any document that shows your current address, such as: Electricity bill Water bill Bank statement
Passport size photographs	Two recent passport-size photographs

Steps to Open a PO-MIS Account

To open a PO-MIS account, an applicant can follow these steps:

Step 1: Visit a post office branch.

Step 2: Fill out a PO-MIS account opening form.

Step 3: Submit the required documents, including:

Identity proof (such as PAN card, Aadhaar card, or voter ID card)
Address proof (such as electricity bill, water bill, or bank statement)
Passport size photographs

Step 4: Deposit the minimum investment amount of Rs. 1,000.

Step 5: Receive the PO-MIS account passbook.

Premature Withdrawal from the POMIS Account

The rules on premature withdrawals from the Post Office Monthly Income Scheme (PO-MIS) account are as follows:

Conditions of Period of Withdrawals from POMIS Account	Conditions
Before 1 Year of POMIS account	No withdrawals allowed
Between 1 – 3 years of POMIS account	2% penalty on the principal amount before refund
Between 3 – 5 years of POMIS account	1% penalty on the principal amount before refund
If the account holder dies before the maturity of the POMIS account	Premature closure of account is allowed The amount will be refunded to the nominee or legal heirs

Note: To close the PO-MIS account early, the account holder is required to submit the form and passbook to the Post Office.

Advantages of Post Office Monthly Income Scheme (PO-MIS)

Post Office Monthly Income Scheme offers the following advantages to the investors:

Protection of Investment: PO-MIS is a government-backed scheme, which means that the invested amount is safe and secure.
Assured Returns: PO-MIS offers guaranteed returns in the form of interest, which is credited to the investor's account every month.
Multiple Account Ownership: Multiple PO-MIS accounts can be opened for an individual, but the total deposit amount cannot exceed Rs. 9 lakhs.
Low-Risk Investment: PO-MIS is a low-risk investment, as it is not subject to market fluctuations.
Affordable Deposit Amount: An investor can start investing in PO-MIS with a minimum deposit of Rs. 1,000.
Flexible Tenure: The tenure of PO-MIS is 5 years, which can be extended in blocks of 5 years.
Liquidity: Investors can withdraw their investment from PO-MIS after the lock-in period of 5 years, subject to a penalty.
Easy to Open and Operate: A PO-MIS account can be opened at any post office in India.
Tax Efficiency: The interest earned on PO-MIS is taxable, but there is no TDS deducted.

Benefits of Post Office Monthly Income Scheme (PO-MIS) for NRI

Even though NRI/OCI/PIO cannot invest in POMIS, they can still benefit from it in the following ways:

Indirect Benefits: POMIS is a government-backed savings scheme that offers a steady monthly income to investors. This helps to improve the financial stability of Indian residents, including the families of NRIs/OCIs/PIOs.
Remittances: You can send money to your families in India through POMIS. This can help your families to invest in POMIS and earn a steady monthly income.
Nomination Facility: POMIS account holders can nominate a beneficiary to receive the balance amount in the account in case of the depositor's death. This can help to ensure that the NRI's family is financially secure even after their death.

Post Office Monthly Income Scheme Vs. Monthly Income Plans

Let us understand the difference between PO-MIS vs. Monthly Income Plans (MIPs) from the table below:

Feature	Post Office Monthly Income Scheme (POMIS)	Monthly Income Plans (MIPs)
Issuer	Government of India (GoI)	Insurance companies
Returns	Guaranteed	Market-linked
Risk	Low	Medium
Liquidity	Lock-in period of 5 years	Lock-in period of 5 years
Taxation	Interest income is taxable	Tax benefits under Section 80C and Section 10(10D) of the IT Act, 1961
Investment amount	Minimum of Rs. 1,000	Varies from plan to plan
Tenure	5 years, extendable in blocks of 5 years	Depends on the chosen plan
Other features	Multiple account ownership, nominee facility	Offers additional features such as SIP, SWP, life insurance coverage, riders, etc.

POMIS Previous Interest Rates

The historical interest rates offered under the PO-MIS scheme are as follows:

Period	PO-MID Interest Rate (in % p.a.)
15 January 2000 – 28 February 2001	11.00%
01 March 2001 – 28 February 2002	9.50%
01 March 2002 – 28 February 2003	9.00%
01 March 2003 – 30 November 2011	8.00%
01 December 2022 – 31 March 2012	8.20%
01 April 2012 – 31 March 2013	8.50%
01 April 2013 – 31 March 2016	8.40%
01 April 2016 – 30 September 2016	7.80%
01 October 2016 – 31 March 2017	7.70%
01 April 2017 – 30 June 2017	7.60%
01 July 2017 0 31 December 2017	7.50%
01 January 2018 – 30 September 2018	7.30%
01 October 2018 – 30 June 2019	7.70%
01 July 2019 – 31 March 2020	7.60%
01 April 2020 – 30 September 2020	6.60%
01 October 2020 – 31 March 2023	7.10%
01 April 2023 – 30 June 2023	7.40%

In Conclusion

The Post Office Monthly Income Scheme (POMIS) offers a safe and stable investment option for individuals seeking regular monthly income. With a fixed interest rate, government backing, and tax benefits, it provides a reliable avenue for those looking to secure their financial future while minimizing risk. POMIS is an attractive choice for risk-averse investors seeking steady returns over a shorter investment horizon.

FAQ's

What is the interest rate of MIS?

The interest rate of the Post Office Monthly Income Scheme (POMIS) is currently 7.4% per annum for the July to September quarter.
Which bank PO-MIS rate is best?

Banks do not offer POMIS (Post Office Monthly Income Scheme). POMIS is a government-backed savings scheme offered by the Post Office of India.
Which is better, NSC or POMIS?

The better scheme between NSC and POMIS depends on your individual financial goals and risk tolerance. If you are looking for a scheme that offers the highest possible returns, then NSC is a better option. However, if you are looking for a scheme that offers regular monthly income, then POMIS is a better option.

What is the difference between POMIS and FD?

The Post Office Monthly Income Scheme (POMIS) and a fixed deposit (FD) are both investment options that offer guaranteed returns. However, there are some key differences between the two schemes:

Feature	POMIS	FD
Issuer	Government of India	Banks and other financial institutions
Returns	Fixed and guaranteed	Fixed and guaranteed
Risk	Low	Low
Liquidity	Low (lock-in period of 5 years)	Medium (may have premature withdrawal penalties)
Taxation	Interest income is taxable	Interest income is taxable
Investment amount	Minimum of Rs. 1,000	Varies from bank to bank
Tenure	5 years, extendable in blocks of 5 years	7 days – 10 years

Which scheme is best for monthly income in the post office?

The best scheme for monthly income in the post office is the Post Office Monthly Income Scheme (POMIS). POMIS is a government-backed savings scheme that offers a fixed monthly income to investors. The interest rate on POMIS is currently 7.4% per annum, which is among the highest in all small savings schemes offered by the government.
What is the Rs. 15 lakh scheme in the post office?
There is no specific post office scheme that is called the 15 lakh scheme. However, the post office offers a number of savings schemes that have a maximum investment limit of Rs. 15 lakh per individual account. These schemes include:
- Post Office Monthly Income Scheme (POMIS)
- Senior Citizen Savings Scheme (SCSS)
- National Savings Certificate (NSC)
- Kisan Vikas Patra (KVP)

†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

Past 10 Years' annualised returns as on 01-12-2024

^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.

*All savings are provided by the insurer as per the IRDAI approved insurance plan.

Tax benefit is subject to changes in tax laws. Standard T&C Apply
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^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.

#The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CARG 8%; ₹50,45,591 @ CAGR 4%

¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.

**Returns are based on past 10 years’ fund performance data (Fund Data Source: Value Research).