Everything about the National Savings Certificate (NSC) scheme

What is National Savings Certificate? The National Savings Certificate (NSC) is a popular and safe small-savings instrument that combines tax savings with guaranteed returns. This scheme is backed by the government and is available at post offices. The distribution reach of India Post has made it popular. Features of National Savings Certificate Eligibility: You need to be a resident Indian to buy the National Savings Certificate. Entry age: No age is specified for opening an account. Investments: Minimum: Rs 1,000, Maximum: No limit. Certificates are available in multiples of Rs 100. Tenure: Five years. Account-holding categories: (i) Individual, (ii) Joint, (iii) Minor through the guardian, (iv) Minor above 10 years. Nomination: Facility is available. National Saving Certificate interest rate The interest rate of NSC is 6.80 per cent which is compounded annually. Investment objective and risks The main objective of investing in the National Savings Certificate is to get a tax deduction on deposits and guaranteed returns on investment. Capital and inflation protection The capital in the National Savings Certificate is completely protected, as the scheme is backed by the Government of India. The NSC is not inflation-protected. This means whenever inflation is above the current guaranteed interest rate, the deposit earns no real returns. However, when the inflation rate is below the guaranteed interest rate, it does manage a positive real rate of ret

This article was originally published on January 11, 2022, and last updated on September 09, 2022.