All about post office savings account

Apart from mailing facilities post offices also provides several other facilities. Apart from a bank one can also open savings account in a post office. They pay the same 3.5 per cent annual rate as the banks do. The thing that is worth to be noted is that the minimum account required for a post office savings account is very low. One can avail this facility at any post office.

Any adult Indian citizen can open a saving account in any post office. A non resident Indian can not open this account. This account can be opened individually or by two three people can open a joint account

The most important salient feature of this account is that it can be opened with a minimal amount of Rs 50. So this account is very useful for the people who are not financially very sound. Moreover one gets income- tax exemption on the tax that one earns on this account. Under the provision of section 10 sub section 15 of Income-tax act.

The amount can not exceed by 1 lac for an individual account holder and if it is a joint account then the maximum amount in the account can not exceed by 2 lacs. The balances in all those accounts taken together should not exceed for Rs 1lac for each of the account holder.

One can also avail cheque book facility with this account, if one wans to avail this facility then he has to maintain minimum balance of Rs 500 in his account and if one do not wish to avail this facility then he has to maintain a minimum balance of Rs 50 in his account.

This saving account comes with a passbook, in which every transaction is entered and signed by the post office.

If one does not operates his account continuously for three years then the account is treated as a silent account and a penalty of Rs 20 is imposed on the account holder and the penalty is deducted from the account itself on the last day of the tear.

The one disadvantage according to the present day scenario is that this account does not provides with the ATM facility.