National Saving Certificate (NSC) is a government-backed savings scheme offered through post offices in India. NSCs can be purchased by individuals, jointly by two adults, or on behalf of a minor. Key benefits include tax deductions, loans against the certificate, and a fixed interest rate for the tenure. NSCs are available in denominations from Rs. 100 to Rs. 10,000 and interest compounds annually at the rate set at purchase for 5 years. Matured certificates continue to earn interest for up to two years if not redeemed.

1. National Saving Certificate [NSC]

2. What is NSC?
National Saving Certificate is an investment saving scheme backed by
the government of India. NSC can purchased from any post office in
India and these certificates are issued on electronic mode and they
may choose to record physical certificates on passbook.

3. Benefits:
•
Subscriber of NSC can take loan from bank by surrendering their NSC
certificate to the bank.
•
Once you have invested , the rate applicate that time will remain the
same throughout the tenure of the investment.
•
The holder gets tax benefit under section 80C of Income Tax
Act,1961.

4. Who can purchase?
NSC can be purchased by a minor, two adults jointly and a adult, who
either in his/her own name or behalf of a minor . No age limit for the
purchase of the certificate.

5. Key features
•
NSC is designed for government employees, businessmen and other
salaried classes who are income tax assesses.
•
NSC is issued in denominations of Rs.100,
Rs.500,Rs.1000,Rs.5000,Rs.10000.
•
The minimum amount invested in NSC is Rs.100 and there is no limit
for the maximum investment but tax deduction under section 80C
can only be claimed for a maximum limit of Rs.1,50,000.
•
NSC has no tax deduction at source [TDS].
•
Interest occurring annually but deemed to be reinvested under
section 80C if Income Tax Act.
•

6. ● Transfer of certificate from one person to another person can be done only
once from date of issue to date of maturity.
● The current interest rate on the 5 year deposit is 7.6% with the effect from
1st Jan,2018 and interest are compounded annually.
● NRI, HUF and Trust are not eligible to purchase NSC but If a person was
Resident Indian at the time of purchasing of certificate and become a NRI
during the maturity period, he shall be allowed to claim benefits of this
scheme.

7. Types of certificate
•
Single holder type certificate : It is issued to the holder himself or
behalf of the minor.
•
Joint A type certificates : This type of certificate issued jointly to two
adults payable both the holders jointly.
•
Joint B type certificate : This type of certificate issued jointly to two
adults payable to either one of the holder.

8. How to buy
•
Buyer can purchase the certificate from any of the Post office by
submitting two photographs, identity proof for verification at the
time of purchase and payment can be made to the Post office by cash
or DD withdrawn in favor of postmaster or through post office saving
bank account. After the payment choose a nominee and get a witness
signature to complete the formalities.
•
Nomination can be done at the time of purchase or before maturity
of NSC and nominated person entitled entitled to claim the maturity
proceeds in case of death of the original holder.

9. Duplicate certificate
•
In case of loss of certificate due to some reasons, owner can apply for
the issue of certificate to the post office where he has been
registered or any other post office.
•
The duplicate certificate includes the statement showing particulars
such as number, date and circumstances attending such loss.
•
Duplicate certificates can be obtained on furnishing an indemnity
bond in a format prescribed by the post office.
•
Duplicate certificates shall be encashable at a post office where
certificates is registered with previous verification.
•
A fee of Rs.5 would be charged for the issue of duplicate certificate.

10. Post mature interest and Pre mature
encashment of NSC.•
After the maturity , NSC has not been redeemed then post maturity
interest given maximum of two years from the date of maturity and
the interest rate as same as interest is given to saving account.
•
NSC can be redeemable before the maturity period in only some
circumstances i.e. on the death of holder, when ordered by a court
law.