Post Office FD Interest Rates

About Post Office;

Post Office Fixed Deposits (PO FDs), offered by India Post, are a secure savings option backed by the Government of India. Operated by the National Savings Institute under the Department of Economic Affairs, these fixed deposits are also known as National Savings Time Deposits. They offer attractive interest rates ranging from 6.90% to 7.50% per annum, depending on the chosen tenure of 1 to 5 years.

For those opting for the tax-saving option, a fixed rate of 7.50% p.a. is applicable. One of the biggest advantages of Post Office FDs is the safety they offer, as they carry a sovereign guarantee, ensuring both capital protection and assured returns. These schemes are especially popular in rural areas where access to banks may be limited, making them a convenient option for small savers.

You can start a Post Office FD with a minimum deposit of just ₹1,000, and there is no upper limit. With attractive interest rates and the backing of the Indian government, Post Office FDs remain a preferred choice for risk-averse investors across the country.

Post Office FD Rates 2025

Note: The data is as of July 1, 2025

Features and Benefits of Post Office Fixed Deposit

• Tenure options include 1, 2, 3, and 5 years
• Minimum deposit required is ₹1,000; no maximum limit
• Attractive interest rates: 6.90% (1 year), 7.00% (2 years), 7.10% (3 years), and 7.50% (5 years)
• Interest is compounded quarterly and paid annually
• Premature withdrawal is permitted after 6 months
• Nomination facility is available both at and after account opening
• FDs can be opened using cash or cheque; cheque date is treated as account opening date
• Accounts are easily transferable between post offices
• On maturity, the FD auto-renews for the same tenure at prevailing rates
• NRIs are not eligible to invest in post office FDs.

Types of Post Office FD Schemes

National Savings Time Deposit Account

• PO FD can be opened for 1, 2, 3, or 5-year tenures
• Minimum deposit is ₹1,000, with further deposits in multiples of ₹100
• The 5-year deposit qualifies for tax benefits under Section 80C
• Interest is compounded quarterly but paid annually
• No extra interest is paid on unclaimed interest amounts
• The FD can be extended after maturity within a specified timeframe
• The interest rate remains unchanged if the account is extended

Term-wise Post Office Fixed Deposit Rates

Short-Term Fixed Deposits

Post Office offers short-term fixed deposits ranges between 1 day and 12 months, providing interest rate of 6.90% p.a. These are categorised as short-term FDs due to their duration being less than one year.

Medium-Term Fixed Deposits

Medium-term fixed deposits come with tenures of over 1 year and up to 3 years. The Post Office offers interest rates ranging approximately between 7.00% and 7.10% per annum on these deposits.

Long-Term Fixed Deposits

Post Office's long-term fixed deposits come with tenures between 3 and 5 years and provide a fixed interest rate of 7.50% per annum, making them a stable investment option for those looking to grow their savings over an extended period.

How to Invest in Post Office Fixed Deposit?

 Online Method

• Visit the official Post Office e-banking website: ebanking.indiapost.gov.in
• Log in using your registered user ID and password
• Go to the ‘General Services’ section and select ‘Service Request’
• Click on ‘New Request’ to begin the FD account opening process
• Follow the instructions shown on the screen to complete the application

Offline Method

• Visit the nearest post office branch
• Collect the FD account opening form and fill it out completely
• Submit the filled form along with required KYC documents
• The post office staff will assist you with the remaining steps to open the account

Eligibility for Opening Post Office FD Account

• Indian citizens can open and operate a Post Office FD account either individually or jointly.
• Minors are also eligible, with the account managed by a parent or legal guardian on their behalf.
• Non-Resident Indians (NRIs), companies, trusts, and other organisations are not permitted to invest in Post Office Fixed Deposits.

Documents Required to Open Post Office FD Account

To invest in the Post Office Time Deposit (POTD) scheme, applicants need to provide valid proof of identity and address:

Proof of Address (any one of the following)

• Latest telephone or electricity bill
• Recent bank statement along with a cheque
• Ration card with photo
• Aadhaar card
• Passport

Proof of Identity (any one of the following)

• PAN card
• Voter ID
• Driving licence
• Passport
• Post Office-issued identity certificate

Additionally, the depositor must mention nominee details in the application form. A witness is required at the time of signing the investment documents.

Tax on Post Office Fixed Deposit

Investments made in a 5-year Post Office Fixed Deposit, also known as National Savings Time Deposit, are eligible for tax benefits under Section 80C of the Income Tax Act. Depositors can claim a deduction of up to ₹1,50,000 on the amount invested under this section.

However, the interest earned on these deposits is taxable. For individuals below 60 years of age, the entire interest income is subject to tax as per their applicable income slab. Senior citizens aged 60 and above can avail a tax exemption on interest income up to ₹50,000 in a financial year under Section 80TTB.

Premature Closure of Post Office Fixed Deposit

As per Para 2(b)(ii) of SB Order No. 22/2023 (National Savings Time Deposit Fourth Amendment Scheme, 2023), the following premature closure conditions apply:

• No withdrawal is allowed within the first six months from the date of opening the TD account.
• For 1-year, 2-year, and 3-year TD accounts closed after six months but before one year, the interest will be paid at the rate applicable to the Post Office Savings Account for the number of completed months.
• If a 2-year or 3-year TD account is closed after completing one year, the interest will be calculated at a rate that is 2% lower than the applicable rate for a 1-year or 2-year TD (as applicable) for the completed number of years. For any period less than a year, the Post Office Savings Account rate will be applied.
• A 5-year TD account cannot be closed before completing 4 years. If it is closed after four years, only the Post Office Savings Account interest rate will be applicable.
• Any interest already paid on the deposit will be adjusted and recovered from the final amount payable at the time of closure.