A ₹15 lakh investment in the Post Office Monthly Income Scheme (MIS) can generate ₹9,250 monthly interest over five years. According to reports from The Economic Times, the scheme offers an interest rate of 7.4% per annum for the October-December 2026 quarter. At this rate, a ₹15 lakh deposit earns ₹1,11,000 annually in interest, resulting in a monthly payout of ₹9,250. The interest is paid monthly rather than compounded, with the principal returned at maturity.
The scheme has specific investment limits with ₹9 lakh maximum for individual accounts and ₹15 lakh for joint accounts. As reported by The Economic Times, the minimum deposit is ₹1,000, with deposits made in multiples of ₹1,000. A joint account can be opened by up to three eligible adults, making it necessary for a ₹15 lakh investment to be made through an eligible joint account rather than a single individual account. The scheme has a five-year tenure and pays interest monthly, unlike recurring deposits where interest is reinvested.
Over the five-year tenure, the total interest payments would amount to ₹5,55,000, while the original deposit of ₹15 lakh is returned at maturity. According to the calculations provided by The Economic Times, the combined interest payments and principal returned would total ₹20,55,000 over five years. The scheme matures after five years, with the principal returned under applicable rules while interest received during the tenure remains separate. Investors must plan how to use or reinvest the principal after maturity, as the interest rate applicable to new accounts may differ from the original rate.
The scheme does not permit account closure during the first year, with premature closure allowed only after that period. As reported by The Economic Times, after one year but before three years, a 2% deduction applies to the deposit. After three years but before five years, a 1% deduction applies. Investors should check applicable conditions with India Post before closing an account early, as premature withdrawal can reduce the principal returned. The interest rate applicable to new accounts may differ from the rate available when the original account was opened.
The Post Office MIS provides no tax benefits on investments and any interest earned is completely taxed according to the account holder's applicable income-tax rules. According to The Economic Times, the scheme may suit investors seeking predictable monthly payouts from lump-sum investments over five years to meet recurring expenses. The scheme is designed for investors who want regular cash flow from a lump-sum deposit while maintaining government backing and monthly interest payments throughout the investment period.
