National Saving Certificate (NSC) -Part II

 

The Finance System - NSC 

Topics covered :

NSC Investment Process 
NSC Tax Benefits
NSC Redemption after maturity & Pre maturity Process

NSC Interest Rate History

NSC Investment Process 

You used to be able to buy National Savings Certificates by getting a paper copy, but this stopped in 2016. Now, you can get them in electronic form or with a passbook. Investing with a passbook is hard and takes a lot of time. Instead, you can invest using a savings account at a nearby post office or an approved bank. To buy NSC certificates online, your savings account needs to have internet banking.

NSC Investment Online Process

To invest in NSC online go through follow steps:  

1. Open Department of Posts (DOP) net banking and log in. 
2. Under 'General Services', select 'Service Requests'. 
3. Click on 'New Requests' and choose ‘NSC Account – Open an NSC Account (For NSC)’. 
4. Enter the deposit amount and choose the debit account linked to the PO savings account. 
5. Choose ‘Click Here’ to run through the terms and conditions. Accept them once done. 
6. Enter the transaction password and click on ‘Submit’. 
7. The deposit receipt will be there to view and download. 

To invest in NSC offline go through follow steps:  

1. Collect the NSC application form online or at any post office. 
2. Fill out the form with all the details. 
3. Submit the form with self-attested copies of the required KYC documents.  
4. Take the original documents for verification and pay the amount you want to invest.
5. Upon approval, collect the NSC of your application.  

NSC Tax Benefits

You can invest any amount in NSC, but only up to Rs. 1.5 lakhs can help you save on taxes under Section 80C. For the first four years, you don’t have to pay tax on your investment. The interest you earn in those years is added to your total amount, which can also help you with tax benefits, as long as it stays under Rs. 1.5 lakhs. However, the interest you earn in the fifth year will not be added to your total and will be taxed based on your tax rate.

NSC Redemption after maturity & Pre Maturity Process

Redemption after Maturity

When the NSC matures, you can cash it at any Post Office, not just the one where you opened your account. If you want to get your money from a different Post Office, you need to fill out a form with details like the serial number, issue date, your full name, and both your registered and current addresses. 

To cash in your maturity amount, bring these documents:

• The original NSC certificate 
• An ID proof
• The NSC cashing form
• The person getting the money must sign the back of the certificate after receiving it.

Pre Maturity Redemption Process

 A National Savings Certificate (NSC) lasts for 5 years. You cannot take your money out early, but in special cases, like if the investor dies or if a court orders it, you might be allowed to withdraw it early. 
Now that you understand what NSC is and how it can help your savings, you can decide if you want to invest. Since the NSC lasts for only five years, it's good for people who want a safe, short-term investment. If you want a better return than a regular fixed deposit (FD), consider investing in NSC.

NSC Interest Rate History

Take Away

Investing depends on how much risk the investor can handle. It's important to think about the risks and rewards of the investment and to have enough information about it. This article will give you important details about the National Savings Certificate (NSC) scheme and what you need to know.