How much is the interest rate on Post Office RD? (April to June 2026)
The Ministry of Finance has announced the interest rate of Post Office RD for the April-June 2026 quarter on 30 March 2026. The Post Office RD interest rate for this period is 6.7 per cent per annum, which has remained unchanged as in the previous quarter.
This interest rate is compounded on a quarterly basis. The special thing is that the day you open the account, the interest rate on that day is locked for the whole 5 years - Changing interest rates in the future also has no effect on your account.
How much will you get in 5 years on a monthly investment of ₹2000? (Full Calculation)
If you deposit ₹2000 every month in the Post Office RD scheme, then your total investment in 5 years (60 months) will be ₹1,20,000. At 6.7% annual interest rate (quarterly compounding), you will get around ₹1,42,700 on maturity.
That means, you will get an additional benefit of around ₹22,700 as interest. This calculation is based on the assumption that you invest on time every month and the interest rate remains at 6.7 per cent for the entire period.
Who can open a post office RD account? (Eligibility)
A post office RD account can be opened by any Indian citizen.
A person above 18 years of age can open a single or joint account.
A parent or guardian can open the account in the name of a minor (above 10 years).
An individual can open more than one RD account. There's no limit.
How much can you invest? (Minimum and maximum amount)
It does not require a large amount of money to start investing in this scheme:
The minimum investment: Rs 100 per month.
Thereafter: Any amount in multiples of ₹10 can be deposited.
The maximum amount of investment: There is no limit... You can invest as much as you want according to your savings potential.
How much to invest? (Duration and extension)
The tenure of Post Office RD is 5 years (60 monthly installments). After the completion of 5 years, you can extend this period for another 5 years if you want. The interest rate during the extension will remain the same as was applicable at the time of opening the account.
Is it possible to close the account ahead of time? (Premature closure)
Yes, the facility of premature closure of account is available with certain conditions:
Premature closure is possible only after 3 years of opening the account.
If you close the account before 3 years, this cannot be done (unless there are some special circumstances).
Pay attention: If you close the account even a day before maturity, you will not get the RD interest rate for the entire period, but the interest rate of the Post Office Savings Account (currently 4%).
Is it possible to get a loan on an RD account? (Loan facility)
There is also a loan facility on the RD account if needed, so that you can meet the need of money without breaking the investment:
The loan facility is available when you have deposited 12 consecutive installments (1 year).
You can take a loan up to 50% of the amount deposited in the account.
The interest rate on the loan: 2% extra on the interest rate of RD.
The loan can be repaid in a lump sum or EMI.
What are the tax benefits under Section 80C?
There is a big misunderstanding here which needs to be cleared. Many people think that Post Office RD gets tax exemption under Section 80C, but it is not so.
There is no tax benefit under Section 80C of the Income Tax Act.
The interest earned on RD is fully taxable.
If the interest is more than ₹10,000 in a financial year, TDS (10% or 20%) is deducted.
What happens if you miss it? (Penalty Rules)
If you are not able to deposit the installment in a month, then there is a penalty:
Default penalty: Penalty of ₹1 on ₹100.
A maximum of 4 defaults are allowed. On missing the 5th time, the account is deactivated.
Inactive accounts can be reactivated within 2 months of 4th default.
If you deposit in advance, you get a rebate. Concession of ₹10 on ₹100 on 6 installments and ₹40 on ₹100 on 12 installments.
Is Post Office RD safe and for whom?
Post Office RD is a fully government guaranteed scheme, so the investment in it is completely safe and there is no effect of market fluctuations. This plan is best for those who:
You want to save every month.
They want to avoid market risks.
Want to save for a 5-year medium-term goal (e.g. children's fees, home renovations).
Conclusion
Post Office RD Scheme is a great savings scheme with the facility of government guarantee, fixed interest rate and starting with a small amount.
Creating a fund of around ₹1.43 lakh in 5 years on a monthly investment of ₹2000 is a good return. Just remember... Deposit instalments on time, do not claim 80C tax exemption (as it is not available) and make early withdrawals only after 3 years if needed.
If you are looking for a safe and disciplined savings route, then Post Office RD can be a great option for you. timesbull.com will continue to bring you similar accurate financial information. If you have any queries, let us know in the comments.