NSC vs Post office FD vs SBI, HDFC Bank, and other bank FDs: If you’re an investor who prefers schemes with guaranteed returns, there’s an attractive option that not only saves your income tax but also offers significantly higher interest rates than the tax-saving FDs of major banks like PNB and SBI. However, to benefit from these higher rates, you need to invest your money for a minimum of 5 years. Know about this scheme here-

Post Office Scheme: National Savings Certificate (NSC)

Let’s refer to the National Savings Certificate (NSC) from the Post Office, a deposit scheme with a 5-year investment period. Currently, this scheme offers up to 7.7 per cent interest, a rate higher than what you’ll find with 5-year FDs at leading banks like PNB, SBI, and HDFC.

Interest Rates at SBI and PNB

At SBI, the 5-year Tax Saving FD offers an interest rate of 6.75 per cent for the general public and 7.25 per cent for senior citizens. PNB offers 6.50 per cent interest to the general public, 7.00 per cent to senior citizens, and 7.30 per cent to super senior citizens.

Interest Rates at HDFC, ICICI, and Axis Bank

In the private sector, HDFC Bank provides 7.00 per cent interest to the general public and 7.50 per cent to senior citizens on a 5-year FD. ICICI Bank offers similar rates. Axis Bank offers 7.10 per cent interest to the general public and 7.60 per cent to senior citizens for a 5-year Tax Saving FD.

Post Office 5-Year Tax Saving FD

The Post Office also offers a 5-year FD with an interest rate of 7.5 per cent, which is still lower than the NSC rate. Like Tax Saving FDs, NSC investments also qualify for tax benefits under Section 80C.

Investment in NSC

To open an NSC account, you need a minimum investment of Rs 1,000, with no upper limit on the amount you can invest.