Post Office Scheme Penalty: Most people in the country prefer to invest in post office than bank. Because in the post office people get more interest than the bank. Along with this, post office investment is safe and gives guaranteed returns .
Various schemes are run in the post office from ordinary citizens to senior citizens. In such a situation, all the schemes are such that they mature in 5 years. If you want to withdraw money before their maturity, then you may have to bear some loss in the form of penalty.
Post Office Monthly Saving Scheme (Post Office MIS)
In Post Office MIS i.e. Monthly Income Scheme, you have to deposit a lump sum amount for 5 years. Through this, you can get a fixed amount every month for 5 years as income. After 5 years you get your money back. But if you need money before 5 years, then you have to pay penalty.
If you withdraw money between one year to three years, then 2% of the deposit amount will be deducted and returned. On the other hand, if the account is more than three years old but you want to withdraw money before 5 years, then after deducting 1% from the deposited amount, the deposit amount is returned to you.
Recurring Deposit Account
Post office recurring deposit account is also for 5 years. Investors of Recurring Deposit Account get the facility of withdrawal after 3 years. On premature withdrawal, you will get the benefit of the rate of interest as per the savings account only.
Senior Citizens Saving Scheme
In this post office scheme also you have to invest for 5 years. The deposit matures after 5 years from the date of opening the account. But if you have to withdraw money from it before five years, then penalty has to be paid. In this, 1.5% of the deposit amount is deducted for withdrawing money before completion of 2 years and 1% of the deposit amount is deducted as penalty for withdrawing money after 2 years.
PPF scheme (Public Provident Fund)
This scheme is of 15 years, but it has a lock in period of 5 years. But if after 5 years you can withdraw money with certain conditions and close the account. But 1% interest is deducted from the date of account opening till the date of closure.
Kisan Vikas Patra (KVP)
This scheme, which doubles the investment in 124 months, has a lock-in period of 30 months. In this scheme, if you withdraw money before 1 year, then you will not get any interest on it. According to the scheme, the investor will also have to pay a penalty for withdrawing money. Interest will be earned on withdrawing money between 1 year to 2.5 years, but the amount will be reduced. After 2.5 years, if the KVP is broken and the money is withdrawn, then no penalty will be imposed and the return will be given according to the interest rate prevailing at that time.