If you’re looking for a safe and guaranteed monthly income, then investing in the Post Office Monthly Income Scheme (POMIS) could be your best bet. As of April 2025, this government-backed savings scheme offers a fixed monthly interest payout, making it ideal for retired individuals, risk-averse investors, and those seeking steady supplemental income. In fact, by investing the right amount, you can earn a fixed monthly interest of ₹5550 directly in your bank account.
Invest in This Scheme of Post Office
| Feature | Details |
|---|---|
| Scheme Name | Post Office Monthly Income Scheme (POMIS) |
| Monthly Income | ₹5550 |
| Investment Required | ₹9,00,000 |
| Annual Interest Rate (April 2025) | 7.4% p.a. (Payable Monthly) |
| Tenure | 5 years |
| Account Type | Single or Joint (up to 3 adults) |
| Premature Withdrawal | Allowed with penalty after 1 year |
| Tax Benefits | No tax deduction at source (TDS), but interest is taxable |
| Official Link | India Post – POMIS |
The Post Office Monthly Income Scheme is a fantastic choice for individuals who want assured monthly income without risking their capital. With a simple process, fixed returns of ₹5550 per month on ₹9 lakh investment, and no hidden charges, it’s especially great for retirees, homemakers, and conservative investors.
What is the Post Office Monthly Income Scheme (POMIS)?
The Post Office Monthly Income Scheme is a savings plan offered by the Indian Post Office. It allows you to invest a lump sum amount and receive guaranteed monthly interest for 5 years. It’s ideal for people who want to generate regular income without exposing their savings to market risks.
POMIS is one of the safest investment options available in India because it’s backed by the Government of India. That means your money is secure, and your returns are assured.
see also:
How Much Should You Invest to Earn ₹5550 Every Month?
The interest rate on POMIS is 7.4% per annum, payable monthly. That means the annual return is 7.4% of your invested amount, divided into 12 monthly payments.
Calculation Example:
- Desired Monthly Income: ₹5550
- Annual Income Needed: ₹5550 x 12 = ₹66,600
- Investment Required: ₹66,600 / 0.074 = ₹9,00,000
So, by investing the maximum allowed amount of ₹9 lakh in a single account, you will receive a monthly interest of ₹5550.
see also: This 12-Month FD of a Private Bank Is Giving Up to 8.25% Interest
Who Can Open a POMIS Account?
The following individuals are eligible to open a POMIS account:
Eligibility Criteria:
- Any resident Indian above 10 years of age can open an account.
- Minors (10 years and above) can operate the account in their name.
- Joint accounts can be opened by up to 3 adults.
You can open multiple accounts, but the total investment limit across all your accounts cannot exceed ₹9 lakh for a single individual.
Key Features of the POMIS Scheme
1. Guaranteed Returns
You get a fixed monthly payout, making it ideal for people who want predictable income, especially retirees.
2. Safe Investment
Backed by the Government of India, there’s no market risk involved.
3. Flexible Account Holding
You can hold the account singly or jointly. In a joint account, the upper limit is ₹15 lakh.
4. Premature Withdrawal
- Allowed after 1 year of account opening.
- If closed between 1 to 3 years, a 2% penalty applies.
- After 3 years, the penalty reduces to 1%.
5. No TDS
There is no Tax Deducted at Source (TDS) on interest, but the income is taxable under the Income Tax Act.
Step-by-Step Guide to Open a POMIS Account
Step 1: Visit Your Nearest Post Office
Important News for SBI, PNB, ICICI, HDFC, and Axis Bank Customers: Minimum Balance Requirements Updated
You can open the account at any authorized Post Office branch across India.
Step 2: Fill the Application Form
Collect and fill Form-A for opening a POMIS account.
Step 3: Submit Documents
Provide the following:
- Aadhar Card (mandatory)
- PAN Card
- Passport-size photographs
- Address proof (utility bill, ration card, etc.)
Step 4: Deposit Your Money
You can invest via cash, cheque, or demand draft. The amount should not exceed the maximum permissible limit.
Step 5: Get Your Passbook
Once the account is opened, you will receive a passbook, and your monthly interest will start getting credited.
Why POMIS is Popular Among Retirees and Risk-Averse Investors
- Retirees prefer POMIS because it provides stable monthly income.
- It’s a great alternative to fixed deposits, which may have lower monthly payout options.
- Parents and guardians can open accounts for minors.
- No fear of market fluctuations or fund manager errors.
see also: Bank of India Revises Fixed Deposit Interest Rates: What You Need to Know
How Does POMIS Compare to Other Investment Options?
| Investment Option | Return Rate | Risk Level | Monthly Payout | Tenure |
|---|---|---|---|---|
| POMIS | 7.4% | Very Low | Yes | 5 years |
| Bank FD | 6.5% – 7.25% | Low | No (quarterly usually) | 1-5 years |
| Mutual Funds | 10-15% (variable) | High | No | No lock-in (open-ended) |
| SCSS (Senior Citizens) | 8.2% | Very Low | Quarterly | 5 years |
POMIS may offer slightly lower returns than some market-linked products but it ensures capital safety and regular income.
Invest in This Scheme of Post Office FAQs
Q1. Can NRIs invest in POMIS?
No, Non-Resident Indians (NRIs) are not eligible to invest in the Post Office Monthly Income Scheme.
Q2. Is the interest earned from POMIS taxable?
Yes, the interest is taxable as per your income tax slab. However, no TDS is deducted.
Q3. Can I extend the account after 5 years?
No, POMIS cannot be extended. You must withdraw or reinvest the corpus after maturity.
Q4. What happens if I invest more than the allowed limit?
Excess investment will not earn interest and the excess amount will be returned.
Q5. Can I transfer my POMIS account to another Post Office?
Yes, POMIS accounts are fully transferable between post offices across India.
