What is post office savings?
A post office is not only for sending letters; you can also open a savings account there. Money kept in it is in effect lent to the government, so repaying it is the government’s responsibility, not a bank’s. In return, the government pays interest.
There are post offices in almost every part of the country, so government savings are within reach even where there is no bank branch nearby.
Say Shirin, who works as a tailor in her village, has saved Tk 60,000. The nearest bank branch is far away, but there is a post office next to the market. She opens an account there and keeps the money in it: it is no longer lying at home, it earns some profit, and the government is responsible for paying it back.
How it works
The Post Office Savings Bank is run by the Department of National Savings, with accounts opened and operated through post offices. Money kept here is in effect lent to the government, so repayment is the government’s obligation.
There are two kinds of account. The ordinary account works much like a bank savings account: you can pay in and take out money, and the rate is lower. The term (fixed deposit) account holds a lump sum for three years; its rate is set in the same government schedule as sanchayapatra.
The term account keeps the rate in force on the day you open it for the whole term. If you withdraw early, profit is recalculated at a lower rate based on how many years you held it.
Tk 100,000 in a term account for three years at 12% a year earns Tk 12,000 a year, Tk 36,000 over three years. After 10% tax deducted at source, you receive Tk 32,400. The rate is only an example; actual rates depend on the amount and when you open the account.
The two kinds of account
- Ordinary account
- You can pay in and withdraw; the rate is lower than on the term account, and interest is added to the balance each year.
- Term account (3 years)
- A lump sum for three years; its rate has been kept equal to that of the 3-Monthly Profit-Bearing Sanchayapatra.
Limits and paperwork
There is a limit on how much one person can keep. Since 2020 it has been reported as Tk 10 lakh in a single name and Tk 20 lakh in joint names, down from Tk 30 lakh and Tk 60 lakh before. Limits can change again, so ask at the post office before opening an account.
Since post office savings moved onto an online system in 2020, a national ID card is required, and a TIN (Taxpayer Identification Number) is asked for on larger amounts. Exactly what is needed at which amount changes from time to time.
What return to expect
The term account rate stood at about 11.28% for many years. In September 2021, rates on larger amounts were cut to roughly 9.3–10.3%. In January 2025 the two-tier rates became roughly 12.25–12.30%, and from July 2025 roughly 11.77–11.82%.
In early 2020, the term account rate was cut to 6% for a few weeks before the old rate was restored. It shows that rates can change suddenly by government decision, although an account already open keeps its rate for the term.
The ordinary account rate was reported at 7.5% in 2020–2021 and was left unchanged at later reviews. To see your real gain, take out tax and inflation.
Why people choose it
- Repayment is the government’s obligation.
- Post offices are almost everywhere, so you can open an account even where banks are far away.
- The term account rate is close to sanchayapatra rates.
- The ordinary account lets you pay in and withdraw.
Points to weigh
- The deposit limit is lower than for sanchayapatra.
- Withdrawing a term deposit early cuts the profit.
- The ordinary account pays less; when inflation is high, the real return can be negative.
- Service at some post offices can be slow, and you may need to go in person.
Tax
Tax is deducted at source from the profit. The rate is set by the Income Tax Act 2023 and each year’s Finance Act and changes from time to time; in recent years it has generally been 5–10% on savings instruments.
The profit is part of your total income. When you file a return, the tax already deducted is set against your total tax, and you can claim back any excess.
Tax rules can change with each year’s Finance Act. Before a big decision, check the latest rules or speak to a tax adviser.
How to get started
- Go to a nearby post office that offers savings bank services.
- Take your documents: national ID card, photographs, your nominee’s ID and photograph, and a TIN if required.
- Decide between an ordinary and a term account; for a term account, get the rate and early-withdrawal rules in writing.
- Keep the passbook or receipt somewhere safe.
Check before you start
- Might I need the term deposit money within three years?
- Is my total within the post office savings limit?
- Do I know the rate on the opening day, and which tier I fall into?
- Have I found out whether I need a TIN?
- Is a nominee properly recorded?