National Savings Certificate (NSC) 2026: Rate, Tax Benefit & Features
Last verified: June 2026. Rates, premiums and rules change — small-savings rates are reviewed quarterly; confirm current terms before investing. General information, not financial advice.
The National Savings Certificate (NSC) is a government-backed, fixed-income scheme that combines guaranteed returns with an 80C tax deduction — a popular choice for conservative, tax-saving savers.
Key features (2026)
| Feature | Detail |
|---|---|
| Interest rate | 7.7% p.a., compounded annually, paid at maturity |
| Tenure | 5 years |
| Minimum | ₹1,000 (multiples of ₹100); no maximum |
| Risk | Government-backed — very low |
Rates are reviewed quarterly; confirm the current rate at purchase.
The tax advantage
The amount invested qualifies for Section 80C deduction (up to ₹1.5 lakh, old regime). A neat quirk: the interest earned each year (except the final year) is reinvested and also counts towards 80C. The interest is taxable, but there’s no TDS on NSC.
Who it suits
Risk-averse savers wanting a guaranteed 5-year return with a tax break. Compare with PPF and ELSS in 80C investments ranked — PPF is longer and tax-free, ELSS is equity with a 3-year lock-in, NSC is fixed and 5 years.
NSC vs tax-saver FD
Both have a 5-year lock-in and 80C benefit. NSC’s rate is government-set and uniform; tax-saver FD rates vary by bank. NSC interest is reinvested; FD interest may be paid out and is taxed similarly.
FAQs
What is the NSC interest rate in 2026?
7.7% p.a., compounded annually and paid at maturity (Apr–Jun 2026; reviewed quarterly).
Does NSC qualify for 80C?
Yes — the investment qualifies, and reinvested interest (except the last year) also counts towards 80C.
Is there a maximum investment?
No maximum; minimum is ₹1,000. Only ₹1.5 lakh qualifies for 80C, though.
