Post Office Savings Account (SB) – Simplified Notes for Exam Preparation
Interest Rate & Account Basics
- Interest Rate: 4.0% per annum (on individual or joint accounts)
- Minimum for Opening: ₹500
- Maximum Balance: No upper limit
Who Can Open This Account?
- A single adult
- Two adults (Joint A or Joint B type)
- A guardian on behalf of a minor
- A guardian on behalf of a person of unsound mind
- A minor who is 10 years or above, in his/her own name
Note:
- One person can open only one account in his/her name.
- One account can be opened for a minor or person of unsound mind.
- Joint account must be closed if surviving holder already has a single account.
Important Rules
- No conversion allowed between single and joint accounts.
- Nomination is compulsory while opening the account.
- When a minor becomes major, they must fill a new account opening form and submit KYC in their own name.
Deposit & Withdrawal Rules
- Deposits/withdrawals must be in whole rupees only.
- Minimum deposit: ₹500
- Minimum subsequent deposit: ₹10
- Minimum withdrawal: ₹50
- No maximum limit on deposits
- Withdrawal is not allowed if balance goes below ₹500
- If balance is below ₹500 at year-end, ₹50 is deducted as Account Maintenance Fee
- If balance becomes zero, account gets automatically closed
Interest Calculation
- Interest is calculated on minimum balance between 10th and last day of the month.
- If balance during that period is below ₹500, no interest is given.
- Interest is added at the end of financial year
- On account closure, interest is paid up to the previous month
- Under Section 80TTA, interest up to ₹10,000 per year is tax-free
Silent/Dormant Account
- If no transaction happens for 3 continuous financial years, the account becomes silent
- To revive, submit an application, fresh KYC, and passbook to the Post Office
Extra Facilities Available (with form submission)
- Cheque Book
- ATM Card
- e-Banking / Mobile Banking
- Aadhaar Linking
- Atal Pension Yojana (APY)
- Pradhan Mantri Suraksha Bima Yojana (PMSBY)
- Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)
Summary (One-liners for Quick Revision)
- Minimum balance: ₹500
- Interest: 4% per year, paid yearly
- Below ₹500 during 10th to last day of month = No interest
- Nomination: Compulsory
- Only 1 account per person
- ₹50 fee if balance < ₹500 at year-end
- 3 years inactivity = Silent account
- Interest up to ₹10,000 is tax-free under Sec 80TTA