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The following are frequently asked questions by the investors, agents and others involved in mobilization of savings and answers to these FAQs are as under:-
1.Why a person should invest in National Savings Products ?
Ans: The investment in NS Products which are the products of Ministry of Finance, Government of India, has a sovereign guarantee and therefore NS products are fully secured and safe. The rate of interest offered on NS products are quite attractive as compared to other schemes in the financial market. The important aspect is that 100% of the collections made in the state is invested in the securities floated by the state govt. as a loan by the Govt. of India on long term basis which is used by the state govt. for their developmental activities in the state.
2. What products are under the fold of NSI ?
Ans : The Ministry of Finance, Govt. of India has structured 8 products to cater the needs of different segments of the investors as given below. All the products are need based and the investors can opt for the product as per their requirement.
1) Senior Citizen’s Savings Scheme
2) Post Office Monthly Income Account
3) 15 Year Public Provident Fund Account
4) National Savings Certificate (VIII Issue)
5) 5-year Post Office Recurring Deposit Account
6) Post Office Time Deposit Account
7) Post Office Savings Account
8) Kisan Vikas Patra
3. Who formulates and introduces the schemes of National Savings?
Ans. Ministry of Finance designs the product in consultation with experts committees /National Savings Institute.
4. From where the investor can buy the National Savings products?
Ans. All products are available at Post offices. PPF and Senior Citizen Savings Scheme are also available with designated Bank’s Branches.
5. Is post Office a member of clearing house to expedite Cheque clearance as banks?
Ans. Yes. All the HPO/GPOs are the members of clearing house for the purpose of Cheque clearance.
6. Is nomination facility available in National Savings Products?
Ans. Yes. The depositor can nominate one or more persons as the nominee and also mention the share of nominee in case of more than one nominee.
7. Whether NRI(s) can invest in the National Savings Products?
Ans. NRI(s) are not authorised to make investment in National Savings Products.
8. What is the mode of payment on maturity / premature closure of National Savings Products?
Ans: On Premature Closure or maturity, the deposits accepting authorities make payment in cash upto Rs. 20,000/- and by cheque in excess thereof.
9. Whether NS products enjoy the benefit of tax concession under Income Tax Act ?
Ans : The deposit in PPF, N.S.C. VIII Issue enjoy the benefit of tax concession under I.T.Act. The deposits in PPF qualify for deduction upto maximum of Rs.70,000/- and deposits in NSC VIII Issue upto Rs.1,00,000/- under Section 80 C of Income Tax Act. The interest accrued in NSC VIII Issue for 5 years also enjoy the benefit of Sec. 80 C of I.T.Act.
The interest on PPF and POSA is tax free as per the tax provisions under Sec.10 of I.T. Act.