Post Office Monthly Income Scheme: Interest Rate, Benefits and Eligibility

The Post Office Monthly Income Scheme is a savings scheme offered by the Government of India. It provides interest payments every month on the amount you deposit. It can be useful for individuals looking for a regular monthly income from their savings while keeping a part of the deposit.

In this guide, we will take a look at this post office monthly income scheme, interest rates, benefits and eligibility criteria. 

What Is the Post Office Monthly Income Scheme?

The Post Office Monthly Income Scheme, also known as POMIS, is a savings scheme under which the deposited amount earns interest. This interest will be paid to you every month.

Key Features:

The key features mentioned in the provided scheme details are:

The account can be opened with ₹1,000 or any amount in multiples of ₹1,000. Only one deposit can be made in an account.

An individual can also operate more than one account. However, the applicable overall deposit ceiling must be followed.

Post Office Monthly Income Scheme Rate of Interest

The post office monthly income scheme rate of interest is 7.4% per annum. The interest is payable to the account holder on completion of a month from the date of deposit.

This monthly interest does not earn additional interest if the account holder does not claim it.

Interest can also be received through:

• Auto-credit facility into a Post Office Savings Account
• ECS into the depositor's bank account

Post Office Monthly Income Scheme Eligibility

The post office monthly income scheme eligibility criteria include the following:

• The individual must be a resident citizen of India.
• A single adult can open an account.
• A joint account can be opened by up to three adults.
• A guardian can open an account on behalf of a minor.
• A guardian can open an account on behalf of a person of unsound mind (referred to as an Authorised Account).
• A minor who has attained the age of 10 years can open and operate an account.
• An individual can open and operate one or more accounts, subject to the applicable deposit ceiling.

Joint Account Eligibility

The Post Office Monthly Income Scheme allows joint accounts with up to three adults. There are two types og this account:

• Joint 'A' type: The account is operated by all the depositors or the surviving depositors jointly.
• Joint 'B' type: The account can be operated by any of the depositors or the surviving depositors separately.

How Is Monthly Interest Calculated Under Post Office MIS?

Under the Post Office Monthly Income Scheme, the deposit earns interest at 7.4% per annum. Let us understand how monthly interest will be calculated with an example:

Disclaimer: These figures are illustrations based on just the annual interest rate and do not account for any other considerations.

This monthly payout structure is a key feature of the POMIS scheme, particularly for investors who prefer receiving interest at regular intervals instead of waiting until the account reaches maturity.

Post Office Monthly Income Scheme Benefits

If you want to know how to open post office monthly income scheme, you must also know the benefits it provides:

1. Monthly Interest Payout

The primary feature of this scheme is that interest is payable every month. This can make the scheme relevant for investors who want their interest to be available at regular intervals rather than waiting until maturity.

2. Option for Single and Joint Accounts

The post office monthly income scheme MIS allows both single and joint accounts. A joint account can have up to three adult depositors, subject to the applicable rules.

3. Defined Investment Limits

The minimum deposit is ₹1,000 or in multiples of ₹1,000 only. The maximum investment limit is ₹9 lakh for a single account and ₹15 lakh for a joint account.

4. Five-Year Maturity

The account can be closed after the completion of five years. This provides a defined maturity period for the deposit.

5. Monthly Interest Transfer Options

Interest can be credited to you through an auto-credit facility into a Post Office Savings Account or through ECS.

6. Provision for Premature Closure

The account holder can withdraw the deposit and close the account after one year from the date of opening. This is subject to the applicable terms and conditions.

Post Office Monthly Income Scheme Deposit Limits

The Post Office Monthly Income Scheme has prescribed limits for the amount that can be deposited.

The account must be opened with at least ₹1,000, and deposits must be made in multiples of ₹1,000. The deposits across accounts are also subject to the applicable ceiling.

If a deposit exceeds the prescribed ceiling, the excess amount is refunded to the account holder immediately. The excess amount carries interest at the rate applicable to the Post Office Savings Account from the time of deposit until the refund.

Therefore, you should check your existing MIS accounts before making another deposit. This will help you ensure that the applicable maximum limit is not exceeded.

Post Office Monthly Income Scheme vs Fixed Deposit

Now, let us understand the differences between POMIS and FD:

Premature Closure of Post Office Monthly Income Scheme

Premature closure of the Post Office MIS is not permitted before the completion of one year from the date of opening the account. After this period, the account holder may be permitted to withdraw the deposit and close the account.

The applicable deductions are:

The remaining amount is paid to the depositor after the applicable deduction. This is why the timing of withdrawal is important to note before investing in the scheme.

Maturity and Closure of Post Office Monthly Income Scheme

The POMIS scheme has a maturity period of five years. The account may be closed on completion of this time period.

If the account holder dies before maturity, the account may be closed. The deposit is refunded according to the applicable provisions. Your nominee will also receive interest up to the month preceding the refund.

An account that has matured but has not been closed continues to earn interest at the rate applicable to the Post Office Savings Account. This happens until the account is closed.

How can POMIS Help with Financial Planning?

The Post Office Monthly Income Scheme can be considered by individuals looking for a low-risk savings option that provides regular income. Its monthly interest payout can help investors plan their finances more systematically and meet recurring financial requirements.

The scheme may be useful for different financial goals, including:

• Retirement Planning: The monthly interest from the post office monthly income scheme for senior citizen can provide a regular source of income during retirement.
• Children's Future Needs: Investors can use the monthly income towards planned expenses related to their children's future.
• Other Financial Goals: The regular payout can also be used to manage other planned expenses and financial requirements.

Since interest under the scheme is payable every month, investors can incorporate the expected income into their financial planning. This can make the POMIS scheme a good option for people who prefer predictable periodic income.

Conclusion

The Post Office Monthly Income Scheme is structured around regular monthly interest payments on a deposit held for a five-year maturity period. The scheme offers an interest rate of 7.4% per annum, and you can make deposits starting from just ₹1,000.

For anyone considering Post Office MIS, understanding the interest payment schedule, eligibility, deposit limits, maturity and withdrawal rules is important before opening an account. 

Compare investment options and plan a portfolio best-suited to financial goals with My Mudra.

Also Read:
- Post Office Saving Schemes in India: Interest & Benefits
- Government Loan Schemes for Women Entrepreneurs in India (2026 Guide)