National Savings Certificate: Benefits, Eligibility and Interest Rates

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An Overview of National Savings Certificate
When it comes to savings, there are a number of choices available to the investors. Their features include attractive interest rates, income tax benefits, safety of investment and more. One of the safest and guaranteed offerings is National Savings Certificates or popularly called as NSC. This investment option help you reap amazing interest rates on your investments in addition to benefits in taxable incomes.

Where to Open NSC?
You can open the account in any of your nearest post office.

 Rate of Interest
The present rate of interest on NSC is 8% per annum compounded yearly and is payable on maturity.

 What is the Eligibility for NSC?
A resident Indian can open account in his name but NRIs are not eligible for its purchase.
What are the documents required?
  • Application form
  • Proof of identity
  • Address proof
Features of National Savings Certificate
These certificates can be held as individual investment or as a joint investment.
The minimum investment amount is Rs. 100 and for maximum amount, there’s no limit. However, one can claim tax deduction for maximum of Rs. 150000.

Tax Benefits
The sum invested in NSC is eligible for tax deduction, just like PPF, under Section 80C up to Rs 1.5 lakh limit in a financial year.

What are the Different Types of NSC Certificates?

 Single Holder Type Certificate:
Here, this type of NSC is issued to the holder or behalf of minor.
Joint A type Certificate:
In this type of certificate, NSC is issued jointly to two adults payable to both the holders jointly.
Joint B type Certificate:
This type of NSC is used jointly to two adults payable to either of the holders.
NSCs are redeemable on maturity of the specified term.

Can I avail Nomination Facility?
Yes, at the time of purchase of NSC, one can nominate any person as a nominee in Form 1 or before the maturity in Form 2.

 Premature Encashment of NSC
  • On the death of holder
  • When ordered by Court of law
If NSC is encashed within one year from date of issue, it shall be done at the face value with no interest. In cases where the encashment is done after one year, interest shall be payable in such cases.

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