How to pay for post office RD online?
Indian banks usually offer Recurring Deposits (RDs). You can invest a small sum of money every month in these deposits to build a corpus for both the long and short term financial goals. Post office RD makes it even easier by enabling the services through a post office.
Many post office services are known only to have offline availability. But payments for RDs can be made online. Let us take a deeper look at RDs and understand how to pay for post office RD online.
What is post office RD?
The post office offers several investments and savings schemes backed by the government of India. The post office Recurring Deposit (RD) is one such scheme introduced to help people build a corpus through a low-risk investment option. Being offered through post offices makes the scheme even more popular and accessible.
The post office RD is a mid-term investment plan that carries nearly zero risk. The scheme has a minimum maturity period of five years. You earn returns through a fixed interest rate. This rate could change from time to time; the current interest rate is 6.2% as of April 2023.
Since the earnings are at fixed interest rate, post office RDs have no market-linked elements. It means the market volatilities do not affect the investments in any way. This makes post office RDs a very low-risk investment option, ideal for risk-averse investors and beginners.
What are the features of a post office RD?
Easy to begin – You can start investing in a post office RD with an amount as low as Rs.100 and no upper limit. This makes post office RDs extremely flexible, allowing you to start slow and increase your deposits as you go on.
Flexible account opening norms – Post office RDs allow you to start an account as the sole account holder or jointly with another individual. You can even create a post office RD account in the name of a minor.
Interest rate – RDs offer a fixed interest rate, making them one of the low-risk investment options. The returns you get from the scheme are decent and comparable to similar conservative options. Further, when the returns from the investment are reinvested, the compounded corpus will start accruing interest, resulting in a sizable sum of money.
Systematic scheme – Post office RD is a systematic scheme. You can invest a preset amount of money every month to slowly build a corpus, instilling a much-needed discipline in your investment approach. Ensure you follow your plan for the best results.
Nomination – The scheme provides a nomination facility for your RD. This ensures that your family is financially protected even during challenging times.
Withdrawal: The withdrawal procedure is easy with post office RD, but post offices savings account interest rates will be applicable. You can withdraw your funds after 3 years from the account opening date.
Now that you understand the benefits, let us see how to pay for post office RD online.
How to deposit money online in a post office RD account?
To pay post office RD online, first, you need to create an online RD account. Follow the below steps for the same.
- Visit the nearest post office, preferably your home branch.
- Collect the appropriate form and fill in the necessary details. You must have a valid mobile number and email ID registered with the post office bank account and a debit card to register for online banking.
- Submit the form along with the KYC details. You must submit details about your identity and address proof for the same.
- The post office will then verify your request. This may take up to 24 hours. Once the verification is complete, you can log in to internet banking and access options related to your RD.
As a next step, you will need to create an online username and password.
- Upon verification, you activate your savings account internet banking and visit the department of post online banking portal.
- On the homepage, click on the ‘new user activation’ option.
- Fill in all the necessary details. These include your mobile number, account ID, customer ID, etc.
- In the next step, you will be asked to set passwords. There are two passwords you need to set up here – login and transaction passwords. These are different passwords used for different functions.
- The UserID will be automatically generated, and the details mailed to you.
How to pay post office RD online?
- Transfer the funds for your RD to your post office bank account. This will make paying easy and straightforward.
- Login to your post office account and go to the ‘DOP products’ section. Under that tab, select ‘recurring deposits.’
- On the new page that opens up, enter your account details, including the customer ID and RD account number.
- Enter the RD amount you wish to invest and confirm payment. Once the payment is received, you will receive the confirmation about the same.
Alternatively, you can do the same from the IPPB mobile app as well. The options you have to choose are similar.
How to open your IPPB account?
To open a post office RD account, you need a post office bank account, also known as India Post Payments Bank (IPPB) account. It is a savings bank account that offers a decent interest rate and a safe place to keep your money. Below are the steps you can take for the same.
The best way to open an IPPB account online is by downloading the IPPB app, which is available on both iOS and android platforms. You can search in the app store to download it.
- Once you open the app, click on the “Open your Account now” tab to start the signup process.
- Fill in the basic KYC information. This will include your Aadhaar number, PAN and identity and address proofs.
- Enter the OTP that you receive. Once you do that, you will receive the necessary details to log in to the app.
- In the next step, you will be asked to set up an MPIN. This is a numerical PIN local to your device.
Once you complete this process, you may start using your account.
A post office RD provides you with a conservative yet decent investment option. Ensure you choose the investment amount and duration according to your goals for the best results.
Can we pay RD offline at the post office?
Yes, you have the option to pay your RD amount offline as well, but the online process is simpler. You can follow the above-mentioned steps to make online payments effortlessly.
How can I check my post office RD balance online?
You can find out all the details about your RD online using the IPPB mobile app. You just need to log in and go to the ‘DOP products’ options. You will find the details of your RD under the RD option there.
What are the steps to check the post office savings account balance via SMS?
After registering your phone number linked with your savings/current account, you need to send ‘BAL’ to 773806287 to check your savings account balance.
Can I pay the RD instalment in advance in the post office?
Yes, you can make advance payments for your post office RD.
Is post office RD taxable?
Post office RD comes under Section 80C of the Income Tax Act, which means that you can claim tax benefits of up to Rs.1.5 lakhs for your investment in the scheme. But the interest the RD generates is taxable. It is added to your gross taxable income and taxed according to your income bracket. For instance, if your gross taxable income is Rs10 lakhs and the interest earned on RD is Rs.10,000, your total taxable income will be considered as Rs. 10.1 lakhs.
Can I withdraw my post office RD before maturity?
You can withdraw post office RD before maturity under certain conditions. To begin with, you must at least have stayed invested for three years. But if you prematurely withdraw your RD, the interest income will be calculated based on the prevailing post office savings account interest rate and not the RD interest rate.