What the Monthly Income Scheme does
The Post Office Monthly Income Scheme (POMIS) turns a lump sum into a fixed monthly payment for five years. You deposit once, the post office credits the same interest to your savings account every month, and your deposit comes back at the end. Unlike SCSS it has no age limit, so it suits anyone who wants a steady, predictable income: a retired parent, a family living on the interest from a property sale, or someone bridging the gap before a pension starts.
POMIS at a glance
| Interest rate | 7.4% a year (July–September 2026), paid monthly |
|---|---|
| Deposit | ₹1,000 minimum; up to ₹9 lakh single, ₹15 lakh joint |
| Term | 5 years, no extension |
| Early closure | After 1 year; 2% of the deposit deducted before 3 years, 1% after |
| Tax | Interest taxable at your slab; no deduction on the deposit |
How the monthly income is calculated
It is simple interest, paid out as it falls due, so the amount never changes during the five years. At 7.4%, every ₹1 lakh brings in ₹617 a month. ₹5 lakh pays ₹3,083 a month, ₹37,000 a year and ₹1,85,000 over the term.
When you don’t need the income yet
The monthly interest earns nothing once it lands in a savings account at a low rate. If you do not need it every month, move it into a 5-year post office recurring deposit at 6.7%. With ₹5 lakh in MIS, that RD grows to about ₹2,20,045, against ₹1,85,000 if the interest is simply spent. The calculator above shows this for your own amount.
If you will never need the income, skip MIS: a National Savings Certificate or a 5-year time deposit compounds the interest for you and ends with more.
MIS or SCSS?
| Monthly Income Scheme | SCSS | |
|---|---|---|
| Rate now | 7.4% | 8.2% |
| Paid | Every month | Every quarter |
| Who can invest | Any adult | 60+, or 55+ if retired |
| Limit | ₹9 lakh single, ₹15 lakh joint | ₹30 lakh per person |
| Tax break on deposit | No | Yes, old regime |
If you are eligible for SCSS, it pays more; many retirees fill it first and add MIS on top. Work out the quarterly figure with the SCSS calculator.
Frequently asked questions
What is the Post Office MIS interest rate?
7.4% a year for July–September 2026, paid out every month. The rate on the day you open the account stays the same for all five years.
How much monthly income will ₹9 lakh give in MIS?
At 7.4%, ₹9 lakh in a single account pays ₹5,550 a month, and the ₹15 lakh joint limit pays ₹9,250 a month. Your deposit comes back in full after five years.
What is the maximum I can invest in MIS?
₹9 lakh in a single account and ₹15 lakh in a joint account of up to three adults. The limit covers all your MIS accounts together, and in a joint account each holder is treated as owning an equal share.
Can I withdraw MIS before five years?
Not in the first year. After one year and before three, 2% of the deposit is deducted; after three years, 1%. The interest already paid to you is not taken back, only the deduction from the deposit applies.
Is Post Office MIS interest taxable?
Yes. The interest is taxed at your slab rate as income from other sources, and the deposit does not qualify for the Section 80C (now Section 123) deduction. Show the interest in your return even if no tax was deducted from it.
What happens when the MIS account matures?
After five years the deposit is paid back and the account closes. There is no extension: to keep the income going, open a new account at the rate in force then.
Sources
- National Savings Institute – Monthly Income Account Scheme
- Department of Economic Affairs – small savings interest rates
- India Post – post office savings schemes
Last updated 21 September 2026. Results are estimates for planning only and are not investment, tax or legal advice. See our disclaimer.