The Post Office Monthly Income Scheme (POMIS) is a government-backed savings plan designed to provide investors with a fixed monthly income. It’s ideal for individuals seeking a low-risk investment option with regular returns. The scheme has a tenure of 5 years, after which the invested amount is returned to the investor.
Key Features of POMIS
- Interest Rate: As of July 2025, POMIS offers an interest rate of 7.4% per annum, payable monthly.
- Investment Limits:
- Minimum: ₹1,000
- Maximum:
- ₹9 lakh for a single account
- ₹15 lakh for a joint account (up to 3 adults)
- Tenure: 5 years
- Eligibility:
- Resident Indian individuals
- Minors aged 10 years and above (account to be converted upon attaining majority)
- Account Types:
- Single
- Joint (up to 3 adults)
- Minor (with guardian)
- Nomination Facility: Available
- Transferability: Accounts can be transferred between post offices across India.
Benefits of Investing in POMIS
- Regular Monthly Income: Investors receive a fixed monthly payout, providing a steady income stream.
- Capital Protection: Being a government-backed scheme, the principal amount is secure.
- Low Risk: The scheme is not market-linked, making it suitable for risk-averse investors.
- Ease of Access: Available at all post offices across India.
- Reinvestment Option: Upon maturity, the principal can be reinvested in the same scheme.
Tax Implications
- Interest Income: Taxable as per the investor’s income tax slab.
- TDS: No Tax Deducted at Source (TDS) on interest payouts.
- Section 80C: Investments in POMIS are not eligible for deductions under Section 80C of the Income Tax Act.
Premature Withdrawal
- Before 1 Year: No withdrawal permitted.
- After 1 Year but Before 3 Years: Withdrawal allowed with a 2% deduction on the principal amount.
- After 3 Years but Before 5 Years: Withdrawal allowed with a 1% deduction on the principal amount.
How to Open a POMIS Account
- Visit: Your nearest post office.
- Obtain: POMIS application form.
- Submit:
- Duly filled application form.
- Passport-sized photographs.
- Identity proof (e.g., Aadhaar, PAN).
- Address proof (e.g., utility bills, voter ID).
- Deposit: The investment amount via cash or cheque.
- Nomination: Assign a nominee at the time of account opening or anytime during the tenure.
Example Calculation
If you invest ₹5,00,000 in POMIS at an interest rate of 7.4% per annum, your monthly interest income would be:
- Annual Interest: ₹5,00,000 × 7.4% = ₹37,000
- Monthly Interest: ₹37,000 ÷ 12 ≈ ₹3,083
This amount would be credited to your account every month for 5 years.
Who Should Invest?
- Retirees: Seeking a stable monthly income.
- Risk-Averse Investors: Looking for secure investment options.
- Individuals Without Regular Income: Desiring a fixed monthly return.
The Post Office Monthly Income Scheme is a reliable and secure investment option for those looking to earn a fixed monthly income without exposure to market risks. Its government backing and ease of access make it a popular choice among conservative investors.
