What is Post Office ?
The Post Office is present from more than 150 years playing a major role in communications and small deposits. It has overcome the barrier of communication all through the nation which has helped in the socio economic development of the country.
Meaning of Post Office Saving Banks
The government has made the post office as the banks also which will accept savings The post offices will give various services. They are not only involved in delivering mails but also accept deposits, deliver retail service like sale of forms, bill collection etc. provide savings schemes, life insurance cover etc. There are about 1.5 lakhs post offices in the country which provides different types of saving schemes. It provides the risk-free investment options which are safe and secured and provides the capital gains without Tax Deduction at Source (No TDS).
There are various investment schemes available for an individual and their choose the best suitable for them. The various financial institutions are present like commercial banks, cooperative banks, post office savings banks, life insurance corporation public limited company.
The various schemes provided by the post offices like the Savings Account Schemes, Recurring Deposit Schemes, Time Deposit Schemes, Public Provident Fund Schemes, Monthly Income Schemes. National Savings Certificates, Kisan Vikas Patras, and Senior Citizens Savings Scheme.
The basic financial services given by the Department of Posts are the Post Office Savings Bank. It is the oldest and biggest banking service institution in the nations. The Department of Post works the Post Office Savings Scheme on behalf of the Ministry of Finance, Government of India. There is basically. 20.50 saving account which are operating and these are operated by more than 1,54,000 post offices all over the country.
Functions and Importance of post office
The various functions and working of post office saving banks are as follows :
1) Various Benefits to Investors :
It provides Done different of merits to the investors. The types Central Government has tried to make the National Saving Movement popular by giving high rate of interest in post offices as compared to the scheduled banks. It has helped in mobilizing the savings of the people which has small income.
2) Various Attractive Schemes :
The Post offices provides various type schemes according to the requirement of the investors. The tax saving is very popular in the high-income groups than the small savers.
3) Various Tax-Benefit :
The investment done in the post offices provides with the different schemes which helps in saving tax of the investors as there are various exemption of investment contribution or interest income from tax or both according to certain limits.
4) Attractive Rates :
The post office gives the attractive rate on the savings of the investors which also provides the nomination facility. These savings can be transferred to other Post Office across India.
5) Safe Investment :
They provide safe and attractive investment opportunity to the public as per the regulation of Government of India.
6) Mobilization of Resources :
The post offices can be used for mobilizing the huge resource which can be used by the government for the development of economy.
7) Attracting Public :
The various post office schemes can be used for attracting more public to open post office accounts for getting tax relief and high return. These schemes were made under the Government Saving Bank Act, 1873, Government Savings Certificates Act, 1959 and Public Provident Fund Act, 1968.
Types of Post Office Saving Schemes
The various post office saving schemes are as follows :
1) Post Office Monthly Income Scheme :
The post office monthly income account is for the investors who want to invest some amount and get interest on it on the monthly basis for fulfilling their basic requirement.
2) Public Provident Fund :
Public Provident Fund (PPF) is a type of saving which also gives the tax benefit. acts as the retirement planning tool for those investors who do not have any structured pension plan for them.
3) National Savings Certificate :
It is also known as NSC which both time and tax saving which provide better return with safety to the investors.
4) Post Office Saving Account :
The post office saving account is same to the various saving account in the commercial banks. It is a safe investment and the investors will deposit that money which they may require for liquidating it fully or partially at very short notice.
5) Post Office Time Deposit :
In this the investors deposit, same amount for a fixed time period. The function of post office time deposit is same as the fixed deposit accounts.
6) Senior Citizens Savings Scheme :
This scheme as the name suggests is for senior citizens. It is the investment option for the senior citizens for the period of five years and gives the high rate of interest which is paid in quarterly installment.
7) Recurring Deposit Account :
The recurring deposit is the organised method for saving money. This scheme is for those investors who save the fixed amount regularly or periodically.
8) Rural Postal Life Insurance :
This scheme is given by the post office in the rural areas since 1995. The basic objective of the scheme is for giving insurance cover to the rural public. It is helpful for the weaker sections and women workers in the rural areas. They are also involved in spreading awareness among the rural population.
9) Postal Life Insurance :
The post office is also offering the life insurance schemes from 1884. These services were first given to the employees of post and telegram department but after that it was also offered to employees of other departments and bank also. In 1995 it was opened for all the people.
10) Kisan Vikas Patra :
This type of certificate is given by the post offices which doubles the deposit done by the investors on prevailing interest rates. There is limit on the investment done by the investors. There is no premature encashment until death of the holder.
11) Sukanya Samriddhi Accounts :
The account is opened for the girls till the age of 10 years from the birth. There is one year of grace given in the starting of the scheme. So now the girl who are. born between 2.12.2003 and 1.12.2004 can open the account till 1.12.2015. the rate of interest is 8.6% p.a. which is calculated on the yearly basis and yearly compounded.
12) Mgnrega :
The government has opened 3.5 crore more post office account which are linked with the Aadhaar card. Earlier these MGNREGA account was used for receiving wages from the workers in the rural employment scheme. But now the government is using the same account for transferring pensions, scholarships and social welfare payments.