7.5% interest on 5-year Post Office Time Deposit; major banks like SBI and HDFC lag behind..
Post Office FD Interest Rates: If you are looking for a safe investment that offers impressive returns, there is good news for you. The Ministry of Finance has announced the interest rates for small savings schemes—including Post Office Time Deposits (FDs)—for the July-September 2026 quarter. The government has kept the interest rates unchanged this time as well, meaning you will continue to earn returns just as before. Investing in the 5-year FD scheme offers an attractive interest rate of 7.5%.
**Outperforming SBI and HDFC Bank**
When it comes to safe investments offering high returns, the Post Office Time Deposit scheme continues to outperform major banks in the country. If you compare it with the FD rates of major institutions like the State Bank of India (SBI), HDFC Bank, ICICI Bank, or PNB, the returns offered by the Post Office are significantly better and more beneficial.
**What are the interest rates for different tenures?**
The Post Office offers investment options across four different tenures. You can easily understand the interest rate structure from the table below:
**Tenure** | **Interest Rate**
1-Year Time Deposit | 6.9%
2-Year Time Deposit | 7.0%
3-Year Time Deposit | 7.1%
5-Year Time Deposit | 7.5%
**Note:** Interest on this scheme is calculated using quarterly compounding and is credited to your account at the end of each year.
**Tax Benefits and Investment Rules**
**Who can open an account:** Any adult can open this account individually, or up to three people can open a joint account. Additionally, parents can open an account in the name of their minor children, or children above the age of 10 can open an account in their own name.
Investment Limit: There is no maximum limit for investment in this scheme, but you can start with a minimum of ₹1,000.
Tax Benefit: If you opt for the 5-year Post Office Fixed Deposit (FD), you can avail of a tax exemption on investments of up to ₹1.5 lakh under the Income Tax Act. However, this benefit is available only to those who choose the Old Tax Regime.
Disclaimer: This content has been sourced and edited from Money Control. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
