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National Savings Certificate Basics

Details about who all can and how can one invest in to NSCs along with other benefits


28 Dec 2010

National Savings Certificate (NSCs)

National Savings Certificate is an assured return Tax Saving instruments. It pays interest at 8 per cent for a duration of six years, which is relatively lower compared to other small saving schemes. You buy NSC for a specific value and the interest compounded and returned along with the principal amount on maturity. The scheme has the backing of the Government of India so there are no risks associated with your investment.

Following are the features of National Saving Certificate:


Who Can Purchase

NSC can be purchased by an adult who is a resident in india, It can also be bought jointly or by an adult on behalf of a minor.

Investment Amount

Minimum Investment Rs.100/- No limit on investment. Certificates are available in denominations of Rs.. 100/-, Rs.. 500/-, Rs.. 1000/-, Rs.. 5000/-, Rs.. 10,000/-.

Maturity period

Six Years..

Interest Rate

8% Interest compounded six monthly but payable at maturity. With effect from 1st March 2003,Investment of Rs.. 100/- grows to Rs. 160.10 after 6 years.

Nomination facility

Nomination facility is available.


The certificate  are transferable to any post office in India as well as can transfer one person to another with the previous consent in writing of the Postmaster or the Head Postmaster.The transfer can be made after the expiry of aperiod of at least one year from the date of certificate.


The certificate can be encashed afte  six years . These can also be encashed at any other Post Office if the Officer-in-Charge of that Post Office is satisfied with the production of Identity proof of the person presenting the certificate for encashment, is entitled thereto.

Premature Encashment

No Premature encashment is permitted in the normal course. Premature encashment under sub- rule (1) of the rule 16 after the expiry three years from the date of purchase of certificate

Deduction u/s 80C

Tax benefits are available on amounts invested in NSC under section 80 C of Income Tax Act.

Interest Taxability

Interest accruing annually is automatically reinvested, and such re-invested interest will also qualify for tax deduction under section 80 C. No Tax deduction at source.

Other features

Deposits are exempt from Wealth tax.

NSC's can be pledged as security against a loan to Banks/Govt. Institutions.

NSCs can be purchased in Demat Form from select Post Offices.

On written request duplicate certificate can be issued in case of lost, stolen, destroyed, Mutilated or defaced certificate.

44.58 Lakh satisfied customers till Oct 2020
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