SCSS vs MIS Post Office: Which gives higher returns on a Rs 5 lakh investment?

The Senior Citizens' Savings Scheme (SCSS) and the Post Office Monthly Income Scheme (MIS) are two popular government-backed savings schemes for conservative investors. While both offer stable returns, they differ in interest rates, payout frequency, investment limits and tax benefits.

For the July-September 2026 quarter, the SCSS offers 8.2% per annum, while the Post Office MIS offers 7.4% per annum. The government revises the interest rates on both schemes every quarter.

The table above compares the approximate annual interest earned on a Rs 5 lakh investment in SCSS and MIS. SCSS pays interest quarterly, while MIS pays interest monthly.

On a Rs 5 lakh investment, SCSS earns around Rs 41,000 a year, while MIS earns around Rs 37,000. This means SCSS generates nearly Rs 4,000 more annual interest than MIS on the same investment.

SCSS is meant for senior citizens seeking regular income after retirement. The minimum investment is Rs 1,000, while the maximum investment limit is Rs 30 lakh per individual across all SCSS accounts. Investments of up to Rs 1.5 lakh qualify for a Section 80C tax deduction under the old tax regime, although the interest earned is taxable under the applicable income tax slab.

Under the Post Office MIS, an individual can invest up to Rs 9 lakh in a single account and Rs 15 lakh in a joint account. The scheme pays interest every month. However, MIS investments do not qualify for Section 80C tax benefits, and the monthly interest is fully taxable according to the investor's income tax slab. No TDS is deducted by the post office on MIS interest.