Central Government has inserted new rules in post office time deposit with the amendment of rule 6 with the notification no. 222 dated 13 March 2014. The new rules are as under.
- Where a deposit in an account standing at the post office working on Core Banking platform become due for repayment, the account shall be automatically renewed from the date of maturity for the same period for which it was opened initially and the deposit shall be eligible for rate of interest ' applicable on the date of renewal.
- Where a deposit in 1-year, 2-year, 3-year or 5-year account is withdrawn prematurely before the expiry of 1 year from date of deposit, interest at the rate applicable to post office savings account from time to time shall be payable to the depositor.
It means the post office deposit will be automatically renewed if not claimed for the period of opened initially. Second, earlier on premature withdrawl less than a year, no interest was given by post office time deposit. but now it will be payable.
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