The MIS scheme, short for post office monthly income scheme, lets you deposit a lump sum once and receive interest every month for five years, then get the full deposit back. The current rate is 7.4% a year, so each ₹1 lakh pays about ₹617 a month.
People also call it POMIS, MIS or the post office monthly scheme. This guide covers the limits, how the payout works, what happens if you close early, and how it compares with SCSS and an FD. It is an independent explanation, not an India Post page.
At a glance
Interest rate
7.4% a year, paid monthlyTerm
5 years from the date of depositMinimum
₹1,000, then multiples of ₹1,000Maximum
₹9 lakh single, ₹15 lakh jointEarly exit
After 1 year, with a 2% or 1% cutTax
Interest taxable, no deduction
How the MIS scheme works
You put in one amount. From the end of the first month, a twelfth of the annual interest is paid into your post office savings account, or into an RD if you ask. After five years you get your deposit back in full.
Your rate is locked when the account starts. If the government lowers MIS rates next quarter, your payout does not change.
₹9 lakh in a single account at 7.4% pays ₹5,550 every month. Over five years that is ₹3,33,000 of interest, and the ₹9 lakh comes back at the end.
What is monthly income scheme in post office, in short
The monthly income scheme (MIS) is the monthly interest scheme in post office: one deposit, interest every month, money back after five years. Older passbooks print it as Post Office Monthly Income Scheme (MIS), and some agents call it the postal MIS scheme. It is sometimes described as a monthly pension scheme in post office, but it is not a pension; it pays only for the five year term. The monthly income scheme of post office is the same at every branch.
Maximum limit: ₹9 lakh single, ₹15 lakh joint
| Account type | Maximum deposit | Monthly income at 7.4% |
|---|---|---|
| Single | ₹9 lakh | ₹5,550 |
| Joint (up to 3 adults) | ₹15 lakh | ₹9,250 |
| Minor (10+) or guardian | ₹3 lakh | ₹1,850 |
The limit counts all your MIS accounts together. In a joint account each holder's share is treated as equal, and that share also counts against each person's ₹9 lakh single limit. A couple can therefore hold up to ₹15 lakh jointly, or ₹9 lakh each in separate single accounts, for ₹18 lakh across the household.
Is MIS the best monthly saving scheme for you
Search for the best monthly saving scheme and you will find two different ideas mixed together. One is a scheme that pays you monthly, which is this MIS scheme of post office. The other is a scheme you pay into monthly, which is the post office RD. A post office monthly saving scheme in the second sense builds a lump sum; MIS spends one.
If you have a lump sum today and want regular cash from it, MIS is the plain choice among government schemes open to all ages. POMIS has no market risk, no fund manager and no exit load beyond the fixed early closure cut. Its drawbacks are just as clear: the rate is lower than SCSS, nothing compounds, and the income is taxable. Read the SCSS drawbacks page too, because many of the same trade offs apply.
Who the MIS scheme suits, and who it does not
- Suits: retirees under 60 who cannot yet open SCSS, a parent who wants a monthly top up for household costs, or anyone parking a lump sum who prefers cash flow over growth.
- Also suits: people aged 60+ who have filled the ₹30 lakh SCSS limit and want more monthly income.
- Does not suit: people who do not need the income. MIS interest is paid out, not compounded, so money left idle in the savings account earns only 4.0%. For pure growth, an NSC earns more.
- Does not suit: high tax bracket earners looking to cut tax, since there is no deduction.
Closing an MIS account early
| When you close | What happens |
|---|---|
| Before 1 year | Not allowed |
| After 1 year, before 3 years | 2% of the deposit is deducted |
| After 3 years, before 5 years | 1% of the deposit is deducted |
| On the death of the holder | Closed without penalty; the nominee or legal heir gets the money |
On ₹5 lakh, closing in year two costs ₹10,000. The interest already paid is not taken back, so in most cases you still come out ahead of a savings account.
Tax on post office MIS interest
MIS interest is fully taxable as income from other sources, at your slab rate, every year. There is no deduction for the deposit under the old 80C rules (now section 123 of the new Income-tax Act).
The post office does not cut TDS on MIS interest, so you must add it to your income when you file your return. With income under the tax threshold, nothing is due.
MIS vs SCSS vs FD: which pays more each month
| For ₹5 lakh | MIS | SCSS | 1 year FD |
|---|---|---|---|
| Rate | 7.4% | 8.2% | 6.9% |
| Paid | Every month | Every quarter | Once a year |
| Per month on average | ₹3,083 | ₹3,417 | ₹2,950 |
| Who can open | Anyone | 60+ (some retirees 55+) | Anyone |
| Tax deduction | No | Yes | No |
If you qualify for SCSS, it pays more. Many retirees fill SCSS first, then use MIS for monthly cash. For the bank side of this comparison, see monthly income options in banks.
How to open the MIS scheme in a post office
- You need a post office savings account, because MIS interest is credited there.
- Fill the account opening form and tick Monthly Income Scheme. Add a nominee.
- Give Aadhaar, PAN and two photos. Pay by cheque or transfer.
- Keep the passbook. It shows the rate, monthly amount and maturity date.
The MIS calculator above shows the monthly figure before you go. For the current rate and its history, see the MIS interest rate page, and there is a Hindi version of this guide.
Common problems and fixes
| Problem | Fix |
|---|---|
| Monthly interest not credited | Check the savings account is active and linked; ask the counter to post pending interest |
| Want the interest to grow instead | Ask for an auto transfer of MIS interest into a post office RD |
| Deposit above the limit | The extra is refunded with savings rate interest; split across a joint account |
| Account matured, not closed | It earns only savings rate after maturity; close or reinvest soon |
Frequently asked questions
What is the post office monthly income scheme interest rate now?
7.4% a year for accounts opened in the October to December quarter, paid every month and fixed for five years.
How much will I get monthly on ₹5 lakh in MIS?
About ₹3,083 a month at 7.4%. On ₹9 lakh it is ₹5,550, and on ₹15 lakh in a joint account it is ₹9,250.
How much can I put in the post office MIS scheme at most?
₹9 lakh in a single account and ₹15 lakh in a joint account, counting all your MIS accounts together.
Can I withdraw MIS money before 5 years?
Yes, after one year. You lose 2% of the deposit if you close before three years and 1% after that.
Is post office MIS good for senior citizens?
It works well alongside SCSS. SCSS pays more, so most seniors fill it first and use MIS for extra monthly income.
Does MIS interest compound?
No. Each month's interest leaves the account. You can route it into an RD to make it grow.