Post Office Monthly Income Scheme (POMIS): Interest Rate, Limits & What You Need to Know in 2026

A neighbour in Pune once put ₹9 lakh into a post office scheme the day her husband retired. 

Every month since, she receives ₹5,550 — deposited directly to her savings account, without lifting a finger. She doesn’t track the markets, doesn’t worry about what a fund manager is doing, and knows exactly when the money is coming.

That’s the POMIS promise — the Post Office Monthly Income Scheme. And for millions of Indian families, it holds up.

What most guides skip over, though, is this: POMIS is a fixed-income instrument. Not a complete financial plan. By the end of this piece, you’ll have a clear picture of what it covers, where it falls short, how much you can actually earn, and when something else might work better for you.

What Is the Post Office Monthly Income Scheme?

POMIS works like a government-backed income arrangement. Hand over a lump sum at any post office across India and, for the next five years, a fixed monthly interest amount lands in your savings account.

There’s nothing to monitor, no fund to track, no market swings to lose sleep over. It’s just a known number arriving on a known date, every single month — until the five years are up and your full deposit comes back to you.

Three types of accounts are available: a single account, a joint account for up to three adults, and a minor account for children above 10 years. A guardian can also open an account on behalf of a minor.

One thing that catches people off guard: the interest starts accumulating from the date of deposit, but the first payout comes one month later — not immediately. If you open the account on the 15th of a month, your first interest credit arrives on the 15th of the following month.

POMIS Key Features and Investment Limits for 2025-26

Here is a complete snapshot of the scheme as it stands today:

Enough about percentages. Here is the actual rupee figure that lands in your account each month, at different investment amounts:

Formula: Monthly income = (Investment × 7.4%) ÷ 12. Source: India Post; Ministry of Finance quarterly rate notification, April 2026.

That ₹9,250 per month from a joint account is a meaningful supplement for a retired couple in Mysuru or Nagpur — covering groceries, utilities, and a portion of medical expenses. But notice what that figure does not include: any life cover, inflation protection, or tax savings.

The 2023 Budget Change That Doubled POMIS — What It Means for You

Before February 2023, the maximum you could put in a single POMIS account was ₹4.5 lakh. A joint account was capped at ₹9 lakh. Those limits sat unchanged for years.

Then Finance Minister Nirmala Sitharaman announced in Union Budget 2023-24 that POMIS limits would be doubled. Single accounts now accept up to ₹9 lakh. Joint accounts go up to ₹15 lakh. This was a significant policy shift.

At the old limit: ₹4.5 lakh at 7.4% = ₹2,775/month.  At the new limit: ₹9 lakh at 7.4% = ₹5,550/month.

Even if you hold multiple POMIS accounts across different post offices, the aggregate balance cannot exceed ₹9 lakh for a single holder or ₹15 lakh for joint. The limit is cumulative, not per-branch — a detail most guides miss entirely.

How to Open a POMIS Account: Step-by-Step

Still offline-only in 2026. Carry your documents, walk in, and it is done in one visit — typically under 30 minutes.

1. Locate your nearest India Post branch that offers savings schemes. Call ahead or check indiapost.gov.in to confirm MIS is available.
2. Collect the MIS account opening form at the counter or download from indiapost.gov.in. Fill in name, address, deposit amount, and nominee details. For a joint account, all co-applicants must be present.
3. Submit documents: Aadhaar card (identity and address proof), PAN card, two passport-size photographs, and the deposit in cash, cheque, or demand draft.
4. Collect your passbook and confirm the first interest credit date — exactly one month from the deposit date.
5. Set up auto-credit standing instructions on the same day to link your Post Office Savings Account for monthly interest deposits. This removes the need for monthly branch visits.

Premature Withdrawal from POMIS: Penalty Rules Explained

You cannot touch the money in the first 12 months. After that, premature closure is allowed — with a penalty deducted from the principal:

Interest already credited to your savings account is not affected. Only the principal is subject to the penalty deduction.

POMIS vs Other Monthly Income Options: An Honest Comparison

Before committing, it helps to see how POMIS actually compares to the fixed-income options Indian families use most:

SCSS available only to individuals aged 60+. FD rates indicative April 2026. LI = Life Insurance.

Putting it plainly: POMIS earns its place because of its simplicity and sovereign backing. Where it gives ground is on life cover, tax efficiency, and the fact that every rupee of interest is taxable. 

A person in the 30% bracket earning ₹9,250/month from a joint POMIS account takes home closer to ₹6,475 after tax. That is the number that matters for retirement planning.

When POMIS Is Not Enough — and What Fills the Gap

POMIS delivers two things that most savers want: their capital stays safe, and they receive a fixed income every month. Reliable, drama-free. 

But walk through this scenario: you invest ₹9 lakh today and pass away in year three. Your nominee gets back what remains in the account — but that ₹5,550 a month stops the day you are gone. Nobody hands the family a replacement income stream.

This is the blind spot we see often at Shriram Life one of the best life insurance companies in India — families who have done the savings part right but have not covered the protection layer. 

A medical emergency, an accident, an untimely death — and the carefully built income plan falls apart for the people it was meant to support.

A plan like the Shriram Life Assured Income Plan sits alongside POMIS rather than replacing it — delivering guaranteed income on its own schedule, with life cover built in and tax benefits that POMIS does not offer.

If wealth accumulation before retirement is the priority rather than immediate income, the Shriram Life Super Income Plan takes a different approach. Our Savings Plan is worth looking at too for the dual benefit of savings and insurance coverage in one structure.

Most people who look back and wish they had planned differently had one layer — not two. POMIS handles the income side well. A life insurance savings plan handles what comes after: the protection if you are gone, the tax efficiency, and the long-term wealth. Together, the plan actually holds.

The Bottom Line

Thousands of Indian families rely on POMIS as their monthly income anchor. That trust is earned. A fixed payout, full principal returned at maturity, and zero exposure to market swings — it does what it says, month after month.

The gap it leaves, though, is just as real. When the account holder passes away, the nominee receives whatever balance remains — but the monthly income stream ends right there. Nobody steps in to replace it. A life insurance savings plan addresses exactly that: it keeps your family covered even after you’re gone, and it comes with better tax treatment and a wealth-building component that POMIS simply doesn’t have.