The rules related to some of the post office schemes are going to change from 1st April 2022.
From this date, interest in cash on Senior Citizen Savings Scheme, Monthly Income Scheme and Term Deposit accounts will stop. Interest will be paid by cheque or deposit in the post office savings account.
The Department of Posts said in a circular that post offices will stop paying interest in cash on Senior Citizen Savings Scheme, Monthly Income Scheme and Term Deposit accounts with effect from April 1, 2022. Interest will be credited only to the account holder’s post office savings account or bank account.
If for any reason the account holders are not able to link their savings account with Senior Citizen Savings Scheme, Monthly Income Scheme and Term Deposit accounts, then the outstanding interest will be paid only by deposit in the post office savings account or by cheque.
The Department of Posts said that some Senior Citizen Savings Scheme, Monthly Income Scheme and Term Deposit account holders have not linked their savings account (Post Office Savings Account or Bank Account) for credit of their monthly/quarterly/annual interest.
In such case the interest payable thereon will remain unpaid. It has also been observed that many term account holders are not aware of the annual interest payment of TD accounts, the circular said.
The circular said that as a preventive measure for better control over post office savings bank operations, promotion of digital transactions, prevention of money laundering
activities and avoidance of frauds, the competent authority has introduced Citizen Savings Scheme, Monthly Income Scheme and Fixed Deposit. It has been decided to compulsorily link post office savings account or bank account for interest payment of accounts.
It is to be noted that no interest is paid on the unearned interest of Senior Citizen Savings Scheme, Monthly Income Scheme and Fixed Deposit accounts. But the interest, if deposited in the savings account, will attract additional interest.
In such a situation, the postal department has urged people to link their savings account (either post office savings account or bank account) for interest payment.
