NSC (National Savings Certificate) Interest Rate
This scheme last updated its deposit rates on 01-Jul-26.
Scheme Overview
NSC is the "safety-first" tax-saver — a fixed 5-year certificate that combines guaranteed returns with a rather clever tax quirk: its yearly interest is treated as a fresh 80C investment for the first four years. It suits salaried investors looking to complete their 80C limit with zero market risk.
- Interest rate: 7.70% p.a., compounded annually and paid entirely at maturity (not annually).
- Minimum / Maximum deposit: ₹1,000 minimum, in multiples of ₹100; no upper limit.
- Tenure / Lock-in: Fixed 5 years (NSC VIII issue).
- Eligibility: Resident individuals, singly or jointly (up to 3 holders); a minor aged 10+ may hold in their own name, or a guardian on their behalf. HUFs, trusts and NRIs cannot invest.
- Premature withdrawal: Not permitted except on the death of a holder, a court order, or forfeiture by a pledgee. NSC can be pledged as collateral for a loan.
- Tax benefit: Deposit qualifies under Section 80C (up to ₹1.5 lakh). The interest reinvested in years 1–4 is also eligible for 80C; only the final year's interest is taxable as \"Income from Other Sources\". There is no TDS.
- Payout: Principal plus accumulated interest at maturity.
Government Schemes — At a Glance
| Scheme | Rate (p.a.) | Tenure | Max Deposit | Eligibility | Early Closure | Tax Benefit | Payout |
|---|---|---|---|---|---|---|---|
| 7.10% | 15 yrs | ₹1.5L / year | Residents | Conditional | Yes | At maturity | |
| 8.20% | 21 yrs | ₹1.5L / year | Girl child | Conditional | Yes | At maturity | |
| 8.20% | 5 + 3 yrs | ₹30 lakh | Age 60+ | Yes | Yes | Quarterly | |
| 7.70% | 5 yrs | No limit | Residents | No | Yes | At maturity | |
| 7.50% | 1–5 yrs | No limit | Residents | Yes | Yes | Annual | |
| 6.70% | 5 yrs | No limit | Residents | Yes | No | At maturity | |
| 7.40% | 5 yrs | ₹9L / ₹15L joint | Residents | Yes | No | Monthly | |
| 7.50% | 115 months | No limit | Resident | Yes | No | At maturity |
Interest rates are for the July–Sept 2026 quarter and are revised quarterly by the Ministry of Finance. This is for educational purposes and is not investment or tax advice — verify current figures on India Post or NSI before investing.
Frequently Asked Questions
National Savings Certificate earns 7.7% per annum for the July–September 2026 quarter, compounded annually but paid entirely at maturity. The rate is locked for your certificate's full 5-year term once purchased, even though the government reviews it each quarter for new certificates.
NSC has a fixed 5-year tenure and lock-in. The certificate cannot be encashed early except on the holder's death, a court order, or forfeiture by a pledgee. It can, however, be pledged as collateral for a loan with banks and select institutions.
You can invest from ₹1,000, in multiples of ₹100, with no upper limit. This suits both small savers completing their 80C limit and larger investors seeking a guaranteed, government-backed return with no market risk. Each certificate is held for its fixed 5-year term.
Resident individuals can buy NSC, singly or jointly with up to three holders. A minor aged 10 or above may hold a certificate, or a guardian on their behalf. HUFs, trusts, companies and NRIs are not permitted to invest in NSC.
Yes, the NSC deposit qualifies for a Section 80C deduction up to ₹1.5 lakh under the old tax regime. The interest reinvested in years 1 to 4 also counts under 80C. Only the final year's interest is taxable, and there is no TDS on NSC.
NSC interest is compounded annually and paid only at maturity, along with the principal — there is no annual payout. For example, ₹1 lakh grows to roughly ₹1.45 lakh after 5 years at 7.7%. The exact maturity value is printed on your certificate.
Yes, NSC certificates can be pledged as security for a loan with banks and select institutions, which is one reason they are widely held. Ownership can also be transferred once during the term under specific conditions. Otherwise, the certificate stays locked for its full 5-year period.