(ii) Premature closure after 3 years from the date of opening of the account is allowed without the depositor requiring furnishing any reason. Postmaster of a Head or Sub Post office will be competent to allow premature closure of the account in all cases irrespective of the amount involved.

(2). The following conditions will also apply to premature closure of RD account: -

(i) Simple interest on the deposits will be paid at the rate applicable to Savings Account from time to time.

(ii) The interest recovered on Loan (Withdrawal) repaid and default fee collected on defaulted instalments will be refunded at the time of closure of the account.

(iii) Where advance deposits have been made in the account, the premature closure will be allowed after the period of advance deposits is over.

(iv) The premature closure of discontinued accounts may be allowed subject to the conditions for premature closure being satisfied.

(3). No separate application is required to be obtained from the depositor. The depositor may fill in the application for premature closure SB-7B and submit the same at the post office along with the Passbook. The Postmaster of sub or head office should close the account by following the procedure laid down for closure of RD Account. No separate sanction needs to be issued.

(4). The amount of interest on defaulted instalments and withdrawal repaid, if any, should be refunded along with the amount at credit of the depositor. The break-up of amounts of deposits and interest may be shown separately on the warrant of payment. No separate receipt for the refund of interest is necessary to be obtained from the depositor. It is also not necessary to issue a separate sanction for the refund of interest.

(5). The application for closure of account i.e., SB-7B along with Passbook for premature closure of RD account received at the Branch Office will be sent to the Head/Account office  for approval. Head/Account office will follow the procedure laid down for closure of RD  Account.

Please click here for the details of lock up periods and various POSB schemes and the impact of premature closure