The government on Friday announced a 5 per cent bonus on new monthly post office deposits.
The bonus will be applicable for Post Office Monthly Income Accounts opened on or after December 8, the finance ministry said in a statement.
The government will also offer tax relief on deposits with a maturity of five years and senior citizen savings scheme, the statement said.
The measures are aimed at promoting post office small savings,
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which has been witnessing a sharp decline due to lower return and lack of tax benefit for most of the schemes.
There has been a demand from different sections for restoring the element of bonus on monthly post office savings.
There has also been a demand that the Five Year Post Office Time Deposit Account and the Senior Citizens Savings Scheme should enjoy the same tax treatment as is applicable to five year bank deposits.
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