In the year of 2010 I followed footsteps of one of colleague and took a National Savings Certificate popularly known as NSC and it is one the tax saving instruments and as far as I know it is sold by the Post Offices all over India. According the official website of Postal Department and here is copy of that
” India has the largest Postal Network in the world with over 1, 54,882 Post Offices (as on 31.03.2014) of which 1, 39,182 (89.86%) are in the rural areas. At the time of independence, there were 23,344 Post Offices, which were primarily in urban areas. Thus, the network has registered a seven-fold growth since Independence, with the focus of this expansion primarily in rural areas. On an average, a Post Office serves an area of 21.22 Sq. Km and a population of 8221 people”
The reach of Post Office is amazing and its really commendable to see how it caters for complete spectrum of Indian population. Normally whenever I go to a government institution I make sure I am never short of patience. I would like to reiterate that there is nothing that is going to help other than your patience. So it was a Saturday morning and I decided to cycle that morning from my place which is in HSR to Post Office in IIMB which is round about 8KM. Its been a while I have cycled so directly went to the petrol bunk for getting right amount of air in the tires. I always make sure that I pay to the guy there as much as Bike or Car guy so that he never refuses to pump. Taking cycle to petrol bunk is kind of antithesis.
Nonetheless I started my ride and it was all fine. I usually try to find some tree or some post to lock my cycle. I could convince a security guy there to at least lock my cycle to a rod which was on the pavement. It was about 10:30 in the morning and as expected there was huge rush and unfortunately for us there were three guys in the front of the line with reams of NSC and there was only one counter with probably a new guy who had to literally struggle with all of the NSC by entering into the system and cross verifying and the line wasn’t moving at all. It was already 11:30 and the line has moved only by one due to the guy having some issues with the NSC maturity and he was called inside to resolve directly with the post master who was a nice elderly lady.
Incidentally there was another counter that was dealing only with Speed posts, Registered Letters and all that kind of stuff. The lady on that counter was saying that normally on other days there are no people at all and see today there are so much of rush and her tone was more of cursing the people. Probably she may be right that “Finacle” software was available only on one counter and even after request from people she couldn’t help the other guy. The guy on the banking counter was probably from north and newly posted into this post office. So he was having lot of difficulty dealing with both outside and inside people and also with the language.
Though slowly but people started to lose patience as the queue wasn’t moving at all. And as usual you start to see murmur growing in the room. There were quite old people in the line standing probably to withdraw money from the pension account. There was one really old guy who was made to stand for so long probably drawing a sum of 500. In our country the dignity for the elderly is missing though he was allowed by other people to jump the line and reach at the top but even then it took a long time. There was a lady who started advocating for the old guy but then there was young chap who was sure that he was in the line as well and can’t wait anymore. Both of them were right from their standpoint . That lady and the young guy were fighting for sometime but no one backed off. None of the Post Office people intervened and they kept doing their work like nothing has happened. Then there were lots of people who were just talking so that they can kill time. Now there was a lady probably in her early thirties and this crazy guy behind me started asking that lady ” Have you come to collect pension” to which lady replied “Do I look so old” and this eased the atmosphere as everyone started laughing.
Post Offices are must in our country because banks don’t have reach like them and I feel people who belong to lower middle class feel more comfortable doing banking with them.
So finally my number came and since I had only one NSC of 10K I requested them to give me cash rather than a Cheque for which I need to come again and be in a similar line which I would have not liked. I was fortunate enough that they could give me cash.
Anyways here is what you need to take care while encashing your NSC
- The easiest way to encash NSC is to go to the same Post Office from where you took otherwise there is a procedure of transfer and it will take lot of time.
- NSCs have a maturity date and after that you can go any time and collect you money. If it bigger amount then you may have to make two rounds of Post Office, once to submit your request and then to collect the cheque
- NSC itself is tax free but the interest has tax implication and you have to pay tax on the final year interest if you have been declaring the accrued interest and claiming deduction under Section 80C
I think it is too much of hassle of getting a NSC and then encashing it after 6 years. If you remain in the same city it can be easy otherwise it may be little more tricky. If you have a good friend who will take pain to going to Post Offices and stand in the queue then probably with an undertaking your work can get done.
Hopefully in future Post Offices learn and be little customer oriented towards the older citizens who are either drawing their pensions or having Savings Bank Account. I really feel Post Offices are doing a good job of financial inclusion and have been able break into lower sections of the society which Banks have not been able to due to reach or due to hassle of servicing huge customer base with limited benefits.
That day it took me almost five hours getting this job done which includes my cycle ride. You can reduce it by probably two hours if you go by some motorized travel options 🙂