According to current rates and projections, an investment of ₹15 lakh in the NSC can yield a total return of ₹21.73 lakh over five years — providing a direct profit of ₹6.73 lakh in the form of accumulated interest.
What Is the National Savings Certificate (NSC)?
The National Savings Certificate is a fixed-income savings scheme offered by India Post under the Ministry of Finance. Designed for small and medium-scale investors, it offers a guaranteed interest rate of 7.7% per annum, which is compounded annually but payable at maturity.
The tenure of the NSC is 5 years, making it a suitable mid-term investment for individuals seeking both safety and returns. The scheme is especially ideal for those who prefer traditional saving tools over volatile options like the stock market.
How Much Can You Earn?
If an investor puts in a lump sum of ₹15 lakh, the total maturity amount after 5 years will be ₹21,73,551. This includes ₹6,73,551 as interest, which accumulates due to the power of compounding over the investment period.
The best part is that no additional contributions are required after the initial investment. The entire interest gets automatically compounded annually and is paid out along with the principal amount at the end of the 5-year term.
Tax Benefits Under Section 80C
Investors in NSC are also eligible for tax deductions under Section 80C of the Income Tax Act, up to a limit of ₹1.5 lakh per financial year. However, it’s important to note that while the initial investment qualifies for deduction, the interest earned is taxable in the year it accrues — though it is also eligible for deduction if reinvested.
Key Features of NSC
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Minimum investment: ₹1,000
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No maximum limit, though tax exemption applies only up to ₹1.5 lakh
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Guaranteed returns: 7.7% per annum (as of current rates)
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Lock-in period: 5 years
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Safe and government-backed
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Can be purchased at any post office across India
Who Should Invest?
This scheme is ideal for:
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Risk-averse investors looking for steady and predictable returns
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Salaried individuals and senior citizens seeking capital preservation
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Taxpayers who wish to avail deductions under Section 80C
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Parents planning for their child’s future education or marriage
Before investing, individuals are advised to evaluate their financial goals and liquidity needs. NSC is not a liquid instrument, and premature withdrawals are generally not allowed unless under special circumstances such as death of the holder.
Disclaimer: This article is for informational purposes only. Please consult a certified financial advisor before making any investment decisions. Times Bull is not responsible for any financial losses incurred based on this content.
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- My name is Kuldeep Singh Chundawat. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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