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NATIONAL SAVINGS CERTIFICATE (NSC)


Salient Features

  • Rate of interest 8.60%p.a. compounded half yearly.

  • Minimum investment Rs. 500/-

  • Maximum no limit.

  • Certificates can be pledged as security against a loan to banks/ financial Institutions.

  • A Tax saving investment under Sec 80C

  • Individual or minor can apply

  • Two adults, individuals, and minor through guardian can purchase.

  • Companies, Trusts, Societies or any other Institutions are not eligible to purchase.

  • Non-resident Indian/HUF cannot purchase.

  • No premature encashment.

  • Annual interest earned is deemed to be reinvested and qualifies for tax rebate for the first 5 years under section 80 C of the Income Tax Act.

  • Maturity proceeds not drawn are eligible to Post Office Savings Account interest for a maximum period of two years.

  • Facility of reinvestment on maturity.

  • Facility of encashment of certificates through banks.

  • Certificates are encashable at any Post Office in India before maturity by way of transfer to desired Post Office.

  • Certificates are transferable to any Post office in India.

  • Certificates are transferable from one person to another person before maturity.

  • Duplicate certificate can be issued for in case the orginal one gets lost, stolen, destroyed, mutilated or defaced certificate.

  • Nomination facility is available.

  • Facility of purchase/payment to the holder of Power of Attorney.

  • Tax Saving instrument - Rebate admissible under section 80 C of the Income Tax Act.

  • Deposits are exempt from Wealth Tax.

  • NSCs with a maturity of 10 years will offer a rate of interest at 8.90% p.a.

  • This reduction in the term from 6 to 5 years means you would have your money locked in for lesser time. If you want to stay invested for longer, you can invest in the 10 year NSCs.