What is National Savings Certificate?

What is National Savings Certificate?

The National Savings Certificate also called NSC is a type of savings bond scheme that enables customers, usually low- to middle-income investors, to make investments while saving taxes under Section 80c. The NSC, like other fixed-income investments such as Fixed Deposits, provides assured return and complete capital protection. They cannot, however, generate inflation-beating returns like tax-advantaged Mutual Funds and the National Pension System. Essentially, the government is advertising the National Savings Certificate as an investment option for Indian residents. NSC stands for National Savings Certificate....

Features of NSC

The following are NSC’s primary features:...

Eligibility of NSC

The following are the eligibility requirements for buyers to purchase the NSC:...

Who Should Invest in NSC?

NSC is an Indian government-sponsored savings program. It is predominantly intended for Indian citizens who wish to invest in a relatively safe, government-backed savings instrument. The following groups of individuals might consider making an investment in NSCs:...

Types of NSC

1. Single Ownership Certificate: This particular certificate is specifically intended for issuance to a solitary individual, as implied by its name. The certificate holder has the authority to select a candidate, but all significant decisions will be made by the certificate holder, not the nominee.  In the event that a minor needs a certificate, it might be issued in the name of an adult who is the legal guardian of the minor....

Documents Required for NSC Application

The following are the documents that must be produced if one wishes to invest in an NSC:...

How to Invest in NSC?

Currently, the NSC scheme is available for purchase in either electronic mode (e-mode) or Passbook mode. You can purchase them at post offices, public sector banks, and authorized private banks. You can buy the NSC scheme online in e-mode if you have an authorized bank or post office savings account and your Internet Banking is enabled. Currently, the interest rate on NSCs is 7.7% annually compounded. Please be advised that physical pre-printed National Savings Certificates issued by post offices and institutions ceased to exist in July 2016....

Benefits of NSC

1. Assured Earnings: NSCs offer set rates of interest, and the government guarantees the returns. This implies that you’ll know exactly how much you’ll get at the end of its term making NSCs an investment with minimal risk....

Tax Benefits of NSC investment

Although there is no upper limit on the purchase of National Savings Certificates, investments only of up to ₹1.5 lakh per year qualify the subscriber for tax benefits under Section 80c of the Income Tax Act of 1961....

Frequently Asked Questions (FAQs)

1. Do National Savings Certificate offer tax advantages?...