Mahila Samman Saving Scheme Vs National Savings Certificate

There are a lot of post office saving schemes offered by post office in India to the people having variety of investment needs. This set of financial instruments encourages saving and provide financial security to the people of India.

As these Post Office schemes are backed by the government, they are safe and reliable investment avenues for the individuals. Post offices in India offer their services to the people through a vast network of over 1.55 lakh post offices and around 5.70 lakh employees.

Mahila Samman Saving Scheme: MSSC is a recent one-time small savings scheme launched by the Ministry of Finance for a two-year period up to March 2025 to encourage women to invest. Indian women and girls of all age groups can invest in this scheme. The investment amount ranges from Rs.1,000 to Rs.2 lakh with a maturity period of 2 years.

If you are looking for an investment for a period of two years only with safety of returns, Mahila Samman Savings Certificate can be worth it. If you invest Rs.2 lakh, your maturity value after two years will be Rs.2,32,044 assuming annual compounding of interest which means you will receive and interest of Rs.32,044 on the invested amount.

National Savings Certificate: NSC is one of the government-backed schemes appropriate for low-risk small to mid-income investors to invest for future and also get income tax benefit on the investment value. Lock-in Period of the NSC is 5 years and the income tax benefit is up to Rs.1.50 lakh under Section 80C. Important point to note is that there is no maximum limit on the purchase of NSC.

NSC offers guaranteed interest and complete capital protection as it has government backing. NRIs, Hindu Undivided Families (HUFs) and trusts cannot invest in NSC. This scheme originally had two types of certificates i.e. NSC VIII and NSC IX. However, the government discontinued the NSC IX Issue in December 2015. Now only the NSC VIII Issue is open to invest.

Interest from NSC is taxable in the hands of investors under the head 'Income from Other Sources'. As in NSC, the interest earned is reinvested every year for the first 4 years. Hence, interest earned for first 4 years will not be taxable. Further, this interest reinvested will be allowed as deduction u/s 80C of the Income Tax Act, 1961 and the investor will get tax benefit on this reinvested interest amount. Since the maturity period of NSC is five years, the interest and the principal amount will be given to the investor on maturity i.e. on 5th year and hence the total interest received in the fifth year will be fully taxable.

Two important post office saving schemes offered by post office in India are Mahila Samman Saving Scheme (MSSC) and National Savings Certificate (NSC). Both offer investment benefits but they differ in objective of investment. Let us check out major differences between Post Office MSSC and Post Office NSC in order to make proper investment decision.

Main Points of MSSC: MSSC is launched by the government with an aim to empower women financially and to increase their participation in saving funds for their future. Apart from post offices, all public sector banks together with ICICI Bank, Axis Bank, HDFC Bank Ltd and IDBI Bank have been authorised to operate the Mahila Samman Savings Certificate, 2023.

Features of NSC: Individuals who are risk-averse and want to get income tax benefit under section 80C of the Income Tax Act should invest in NSC. Apart from single account, joint account facility is also available under NSC. An account can be opened under NSC with a minimum of Rs 1000. There is no cap on maximum investment in this scheme. Interest earned is compounded annually and is reinvested by default but will be payable only at maturity.

Post Office Investment Options