Many MIS account depositors are unaware that undrawn interest does not accrue interest.
The post office offers a Monthly Income Scheme, it allows investors to earn monthly income in the form of interest. The government sets the interest rate on a regular basis, and it is a low-risk strategy.
According to the latest circular by the Department of Post, “Interest on MIS/SCSS/TD accounts will be credited only in account holder’s PO Savings Account or Bank Account with effect from 01.04.2022. In case an account holder is not able to link his/her Savings Account with MIS/SCSS/TD accounts up to 31.03.2022 and interest is credited in MIS/SCSS/TD sundry office accounts, the outstanding interest should be paid only through credit in PO Savings Account or by Cheque. Interest payment in cash shall not be allowed from MIS/SCSS/TD sundry office account w.e.f. 01.04.2022.”
These are the advantages of linking your savings account to MIS, TD, SCSS, according to Circular:
a) If interest is credited to a savings account rather than being withdrawn directly from a MIS/SCSS/TD account, it earns more interest.
b) Depositors can access their interest without having to go to the post office and can do so in a variety of ways, including electronically.
b) The necessity to fill out numerous withdrawal forms for each MIS/SCSS/TD account is eliminated.
d) Through the PO Savings Account, depositors can request automatic credit of interest amounts from their MIS/SCSS/TD accounts to their RD accounts.
How to link MIS to Post office savings account or bank account
The PO Savings Account or Bank Account in which the depositor of MIS Accounts desires interest payment can be either single account type or joint account type in which the depositor of MIS should be one of the depositors or guardians in savings account.
Post office savings account
For automatic transfer to a Post Office Savings Account, the account holder must submit SB-83 Form, which is a Standing Instruction application. It will connect your MIS accounts to your PO Savings Account. Make sure to carry your MIS passbooks and Post Office Savings Account passbook to the post office for authentication.
The person must submit an ECS-1 Form (ECS Mandate Form) along with a cancelled cheque or a copy of the first page of the bank account passbook in which he wishes to have the interest amount credited, as well as his MIS, account passbook, to the post office for such a verification.
Please keep in mind that if an account holder is unable to link his or her savings account to MIS by March 31, 2022, and interest is credited to miscellaneous office accounts, the outstanding interest will be paid solely by credit in a PO savings account or by cheque. After April 1, 2022, no cash interest will be paid.