Post Office Monthly Income Scheme 2026: People looking for a regular source of income without taking stock market risks can consider the Post Office Monthly Income Scheme (POMIS). This government-backed small savings scheme allows investors to deposit a lump sum and receive interest every month.

One of the main attractions of the scheme is its predictable monthly payout. At an annual interest rate of 7.4%, an investment of ₹9 lakh can generate ₹5,550 every month.

The scheme may be useful for retirees, senior citizens, homemakers and individuals who want regular interest income from their savings.

However, investors should understand that the monthly payment is interest on their deposit, not an additional pension or a monthly withdrawal from the principal amount.

What Is the Post Office Monthly Income Scheme?

The Post Office Monthly Income Scheme is a small savings product available through designated post offices across India.

Unlike schemes that pay interest only at maturity, POMIS provides interest payments every month.

Investors deposit a fixed amount when opening the account. The applicable interest is calculated on that deposit and paid monthly during the scheme's five-year tenure.

At maturity, the original deposit is returned, subject to the scheme rules.

This structure makes POMIS an option for people who want to preserve their principal while receiving periodic income.

Post Office MIS Interest Rate in October 2026

For the October–December 2026 quarter, the government has retained the POMIS interest rate at 7.4% per annum.

India Post lists the same rate on its official savings schemes page.

MONTHLY INCOME ON ₹9 LAKH INVESTMENT

₹5,550

At 7.4% annual interest, paid monthly

Annual interest

₹66,600

Scheme tenure

5 years

How Much Monthly Income Can You Earn?

The monthly interest depends on the amount deposited.

Calculations are based on the 7.4% annual rate applicable to accounts opened during October–December 2026. Monthly amounts are rounded where necessary.

Calculate Your Monthly Post Office MIS Income

Investment amount

₹5,00,000

₹1,000₹9,00,000

Estimated monthly income

₹3,083

Total interest over 5 years

₹1,85,000

Illustrative simple-interest calculation at 7.4%, before tax. The calculator uses the single-account investment limit.

What Are the Investment Limits?

POMIS has different deposit limits for individual and joint accounts.

A single account allows a maximum investment of ₹9 lakh, while a joint account can hold up to ₹15 lakh.

The minimum deposit is ₹1,000, with further deposits subject to the prescribed multiples and account limits.

A joint account may have up to three adult holders.

Importantly, opening multiple accounts does not allow an individual to bypass the overall investment limit. Each person's share of joint deposits is counted when determining their permitted investment.

What Happens to ₹9 Lakh After Five Years?

Suppose an investor deposits ₹9 lakh in the scheme at 7.4% annual interest.

The monthly interest payment will be ₹5,550.

Over five years, the investor will receive 60 monthly interest payments.

The calculation is:

• Monthly interest: ₹5,550

• Annual interest: ₹66,600

• Total interest over five years: ₹3,33,000

• Original deposit returned at maturity: ₹9,00,000

The combined amount of interest received and principal returned will be ₹12,33,000 before tax.

However, the ₹3.33 lakh interest is paid periodically rather than as a single lump sum at maturity.

Can You Withdraw Money Before Maturity?

POMIS has a five-year maturity period, but premature closure is permitted under specified conditions.

An account generally cannot be closed before one year from opening.

If closed after one year but before three years, 2% of the principal is deducted.

If closed after three years but before five years, the deduction is 1% of the principal.

For a ₹9 lakh deposit, the applicable deduction could therefore be ₹18,000 or ₹9,000, depending on when the account is closed.

Is Post Office MIS Interest Tax-Free?

No. Interest earned from POMIS is taxable according to the investor's applicable income-tax rules.

The scheme does not offer a dedicated tax deduction for the original investment.

Investors should consider their total taxable income and applicable tax regime before calculating their effective post-tax returns.

How to Open a Post Office MIS Account

Investors can visit a post office offering the scheme and complete the prescribed account-opening procedure.

They will generally need identity and address documentation, PAN and other applicable KYC information.

After completing the required formalities and making the deposit, the account is opened according to India Post's rules.

Investors can also ask about the available options for receiving monthly interest through their linked savings account.

For official details, visit India Post Savings Schemes.

Who Should Consider This Scheme?

The Monthly Income Scheme may suit people who have a lump sum available and prefer predictable income over market-linked returns.

It can be particularly relevant for retirees seeking monthly cash flow, families looking to supplement household income and conservative savers who can keep their money invested for five years.

However, investors should consider inflation, taxation, liquidity needs and alternative savings products before deciding.

Conclusion

The Post Office Monthly Income Scheme continues to offer 7.4% annual interest for accounts opened during October–December 2026.

An investment of ₹9 lakh can provide ₹5,550 every month, while an eligible ₹15 lakh joint deposit can generate ₹9,250 monthly.

The main advantage is predictable monthly interest backed by a government small savings scheme, with the original deposit returned at maturity.

Investors should check the latest official interest rate, account limits and tax implications before opening an account.

Source: India Post and the Government of India's October–December 2026 small savings interest rate notification. All returns are calculated before tax. Interest rates for newly opened accounts may change in future quarters.