POMIS: How Monthly Income Can Help Seniors
The Post Office Monthly Income Scheme pays a fixed monthly amount from a lump-sum deposit — a straightforward income tool for retirees. Here's how it works.
For a retiree who needs a predictable monthly amount landing in their account — not a lump sum years from now — the Post Office Monthly Income Scheme (POMIS) is one of the simplest government-backed tools built for exactly that.
1. How POMIS works
You deposit a lump sum, and POMIS pays out fixed interest every month for a 5-year tenure, at the end of which your original deposit is returned in full. Unlike NSC or PPF, there’s no compounding growth of the deposit itself — the deposit stays constant, and the monthly payout is the return.
- Deposit limit: subject to a maximum per individual account and a higher combined limit for joint accounts (revised periodically) — check the current limits before planning your deposit.
- Open to any adult, not just seniors — though it’s especially popular with retirees for its predictable monthly cash flow.
💡 Aha moment
POMIS is one of the few instruments where the "return" and the "income" are the exact same number, paid every month, with zero variability from one month to the next. For a retiree budgeting fixed monthly expenses — rent, medicines, utilities — that predictability is often worth more than a slightly higher but variable-payout alternative.
2. POMIS vs. SCSS — choosing between the two retiree-focused schemes
Both POMIS and SCSS exist to give retirees regular income, but they differ meaningfully:
- Eligibility: POMIS is open to any adult; SCSS requires being 60+ (or 55+ for VRS retirees under conditions).
- Payout frequency: POMIS pays monthly; SCSS pays quarterly.
- Rate: check the current rates for both — they’re revised independently by the Ministry of Finance and aren’t always equal.
- Tax deduction: SCSS deposits qualify for Section 80C; POMIS deposits do not.
A retiree eligible for both might use SCSS for the 80C benefit and POMIS for additional monthly cash flow beyond the 80C limit — they’re not mutually exclusive.
3. Tax treatment
POMIS interest is fully taxable as regular income, with no special exemption. As with SCSS, Section 80TTB (up to ₹50,000 deduction on deposit interest, old regime, for senior citizens) can offset some of this tax — see our senior citizen FD guide for how 80TTB applies across deposit interest generally.
4. Where POMIS fits in a retirement income plan
POMIS works best as one leg of a broader retirement income structure — alongside SCSS, senior-citizen FDs, and any pension income — rather than as the sole source of monthly cash flow, since its rate is fixed for the full 5-year tenure and doesn’t adjust if rates rise elsewhere.
Run the numbers
Use the POMIS Calculator to project your monthly payout from a given deposit.
Learn more from official sources
- India Post — Monthly Income Scheme — official deposit limits and current rate notification.
This is general information, not financial or tax advice. Deposit limits and rates are revised periodically — verify current figures before opening an account.