Any Indian national over the age of 18 years can start investing in a Post Office RD account with a minimum monthly deposit as low as Rs 100.
The Department of Post has amended its rules and regulation for the settlement of RD or recurring deposits on maturity. The changes were brought in to make the process easier after many account holders approached India Post highlighting the need for credit of outstanding RD loan/interest amount on the matured RD account in the software plan. After implementation of these new policies, post offices that are currently using Core Banking Solution or CBS-enabled software will deduct the outstanding RD loan or interest amount from the matured account.
This deducted amount may be adjusted via an office account at the time of maturity payment. Simply put, after this change in the rule, India Post won’t collect the outstanding RD loan or interest amount from the account holder at the time of maturity value. In case of pending loan repayment, the remaining amount along with interest shall be deducted directly from the maturity value of the RD account.
RD accounts of India Post come with a maturity period of 5 years or sixty monthly deposits from the day of opening. It can further be extended for another five years by giving an application to the Post Office where the RD account was opened. However, the interest applicable during this period will be the same with which the RD account was opened.
RD account holders also have the option to retain their account after maturity for up to five years without making any deposit. The saving scheme comes with the facility of loan and account holders can use their RD to borrow money. However, this facility can only be availed once you have completed 12 instalments of RD and have continued it for at least a year.
Loans amounting to up to 50 per cent of the RD deposit can be availed by customers with flexible repayment options. The borrower has the option to pay the amount in a lump sum of equal monthly instalments. The interest rate applicable on such borrowing is 2 per cent plus the rate of return applicable on the RD.
Any Indian national over the age of 18 years can start investing in a Post Office RD account with a minimum monthly deposit as low as Rs 100. Currently, the interest rate offered on RD account by Post Office is 5.8 per cent p.a.