The Post Office Monthly Income Scheme (POMIS) is one of the most trusted small savings schemes in India. Designed for individuals who want stable and predictable monthly income, this scheme is especially popular among senior citizens, retirees, homemakers, and conservative investors.
Backed by the Government of India, POMIS is considered a low-risk investment option. It offers guaranteed returns and fixed monthly interest payouts, making it suitable for those who prefer safety over high-risk, high-return investments.
In this detailed 2026 guide, we will explain everything you need to know about the Post Office Monthly Income Scheme 2026, including interest rate, eligibility, investment limits, taxation, premature withdrawal rules, and how to open an account.
What is Post Office Monthly Income Scheme (POMIS)?
The Post Office Monthly Income Scheme is a government-backed savings scheme that provides fixed monthly income to investors.
Purpose of the Scheme
The primary objective of POMIS is to:
- Provide regular monthly income
- Offer safe investment returns
- Protect capital with government guarantee
Unlike market-linked investments such as mutual funds or stocks, POMIS does not fluctuate based on market conditions. Your principal amount remains safe throughout the tenure.
How It Provides Monthly Income
When you invest in POMIS:
- You deposit a lump sum amount.
- The government pays you interest every month.
- The principal amount is returned after maturity (5 years).
Because it is backed by the Government of India, it is considered a risk-free investment option under the Government monthly income scheme India category.
Latest Interest Rate (2026)
The POMIS interest rate is decided by the government and revised quarterly.
As interest rates may change, investors should always verify the latest rate from the official India Post website or nearest post office.
How Interest is Calculated
- Interest is calculated annually.
- It is paid out monthly.
- The payout is credited directly to your savings account or paid via ECS.
For example, if the interest rate is 7.4% per annum (illustrative only), the annual interest is calculated on your deposit amount and divided into 12 equal monthly payments.
Investment Limits
Understanding the Post office monthly income scheme limit is crucial before investing.
Minimum Investment
- ₹1,000 (in multiples of ₹1,000)
Maximum Investment (Single Account)
- Up to ₹9 lakh (as per latest limits – verify before investing)
Maximum Investment (Joint Account)
- Up to ₹15 lakh (shared among all holders)
How Joint Accounts Work
- Maximum of three adults can open a joint account.
- Each holder has equal share.
- On maturity, proceeds are distributed equally unless specified otherwise.
Joint accounts are commonly used by spouses to maximize investment limits.
Eligibility Criteria
The scheme is open to:
1. Resident Indians
Only Indian residents can invest in POMIS.
2. Age Requirement
- Adults (18 years and above) can open individual accounts.
- No maximum age limit.
3. Minor Accounts
- A minor above 10 years can open an account in their own name.
- Parents or guardians can open accounts for minors.
- On turning 18, the account must be converted to an adult account.
Non-Resident Indians (NRIs) are not eligible to invest.
Account Tenure
Lock-in Period
POMIS has a mandatory lock-in period with restrictions on early withdrawal.
Maturity Period
- The scheme matures after 5 years from the date of opening.
What Happens After Maturity?
- The invested principal is returned.
- You can withdraw the amount or reinvest in a fresh POMIS account (subject to prevailing limits and interest rates).
Renewal Option
There is no automatic renewal. Investors must manually reinvest if they wish to continue.
Premature Withdrawal Rules
The POMIS premature withdrawal rules are clearly defined.
Minimum Holding Period
- Withdrawal not allowed before 1 year.
If Closed After 1 Year but Before 3 Years
- 2% deduction from principal amount.
If Closed After 3 Years but Before 5 Years
- 1% deduction from principal amount.
These penalties make POMIS more suitable for investors who can commit for 5 years.
How to Open a POMIS Account – Step-by-Step
Opening a Post Office Monthly Income Scheme account is simple.
Step 1: Visit Nearest Post Office
Go to your local post office branch that offers savings schemes.
Step 2: Collect and Fill the Form
Ask for the POMIS account opening form and fill in:
- Personal details
- Nominee details
- Investment amount
Step 3: Submit Required Documents
Documents required:
- Aadhaar card
- PAN card
- Passport-size photographs
- Address proof
- KYC documents
Step 4: Deposit the Amount
You can deposit via:
- Cash
- Cheque
- Demand draft
Step 5: Nomination Facility
Nomination is available and recommended. It ensures smooth transfer in case of unforeseen events.
Taxation Rules
Understanding tax implications is important before investing.
TDS Applicability
- No TDS is deducted by post office.
- However, interest is taxable.
Interest Taxability
- Interest earned is added to your total income.
- Tax is charged as per your income tax slab.
80C Benefit
- Investment in POMIS does NOT qualify for Section 80C deduction.
This makes it different from schemes like PPF or NSC.
Example Calculation
Let’s understand with an example.
Example Investment
Suppose you invest ₹9,00,000 in POMIS.
Assuming Interest Rate = 7.4% (Illustrative Only)
Annual Interest:
₹9,00,000 × 7.4% = ₹66,600 per year
Monthly Interest:
₹66,600 ÷ 12 = ₹5,550 per month
Total Return Over 5 Years
Total Interest:
₹66,600 × 5 = ₹3,33,000
Principal Returned at Maturity:
₹9,00,000
Total Amount Received (Principal + Interest over 5 years):
₹12,33,000
This shows how POMIS provides stable and predictable income.
Advantages of POMIS
1. Safe Investment
Government-backed security ensures capital protection.
2. Regular Income
Monthly interest helps meet recurring expenses.
3. Ideal for Retirees
Retired individuals can use monthly payouts for daily needs.
4. Low Risk
No market fluctuations.
5. Simple Process
Easy to open and manage.
Disadvantages / Limitations
1. Limited Maximum Investment
There is a cap on how much you can invest.
2. Taxable Interest
Interest is fully taxable.
3. Not Suitable for High Growth
Returns are fixed and may not beat inflation significantly.
4. Lock-in Restrictions
Premature withdrawal penalties apply.
Who Should Invest in POMIS?
The Post Office Monthly Income Scheme 2026 is ideal for:
- Retired persons
- Senior citizens
- Homemakers
- Risk-averse investors
- Individuals looking for stable monthly income
It is not suitable for:
- Young investors seeking high capital growth
- Equity-focused investors
- Those comfortable with market risks
POMIS vs Bank FD – Comparison
| Feature | POMIS | Bank FD |
|---|---|---|
| Interest Payout | Monthly | Monthly/Quarterly/On Maturity |
| Safety | Government-backed | Bank-dependent |
| Liquidity | Moderate (penalty applies) | Higher flexibility |
| Taxation | Fully taxable | Fully taxable |
| Maximum Limit | Capped | Usually no strict cap |
Key Differences
- POMIS is sovereign-backed.
- Bank FDs may offer slightly flexible tenures.
- Both provide fixed returns.
- Neither offers 80C benefit (unless 5-year tax-saving FD).
Conclusion
The Post Office Monthly Income Scheme 2026 remains one of the most dependable options for conservative investors seeking guaranteed monthly income. With government backing, fixed interest payouts, and simple eligibility criteria, it continues to attract retirees and risk-averse individuals.
However, investors should:
- Verify the latest POMIS interest rate from the official India Post website
- Consider taxation impact
- Evaluate personal liquidity needs
If your goal is capital safety and predictable monthly returns under a Government monthly income scheme India, POMIS is a strong choice.
Before investing, always check the latest rules, limits, and interest rates at your nearest post office to ensure accurate and updated information.
