NSC Calculator

₹1000₹1,00,00,000
1%10%
Time Period
5 Yr (fixed)
Compounding Frequency
Total InvestmentTotal Interest
Invested Amount
₹25,000
Total Interest
₹11,226
Total Amount
₹36,226

What is NSC?

NSC, or the National Savings Certificate, is a fixed-income savings scheme offered by India Post and backed by the Government of India. You invest a lump sum once, and it earns a fixed rate of interest for 5 years.

The interest is not paid out every year. It is added to your investment and compounded yearly, and you receive the whole amount, your investment plus all the interest, when the certificate matures after 5 years.

Because the rate is fixed when you invest and the scheme is government-backed, NSC is a safe choice for investors who want guaranteed returns.

Fun fact

You can start an NSC with just ₹1,000, and there is no upper limit on how much you can invest.

What is an NSC Calculator?

An NSC calculator works out how much your certificate will be worth after 5 years, and how much interest you will earn, based on the amount you invest and the rate of interest.

The rate is locked in on the day you invest, so the maturity amount is guaranteed even if the government changes the rate later.

Why you should use an NSC Calculator?

  • Know your exact returns: Because the rate is fixed, you can see exactly what you will receive after 5 years.
  • Compare with other options: Compare NSC returns with fixed deposits or other savings schemes before you invest.
  • Plan your tax savings: See how much you need to invest to use your Section 80C limit.

How Does an NSC Calculator Work?

The NSC calculator works on the following inputs:

  • Amount Invested: The lump sum you invest, from ₹1,000.
  • Rate of Interest: The yearly rate, currently 7.7%.
  • Time Period: Always 5 years for an NSC.
  • Compounding Frequency: NSC interest compounds yearly. Half-yearly is shown for comparison.

The calculator relies on the following formula:

A = P × (1 + r ÷ n)^(n × t)

A
Maturity amount
P
Amount invested
r
Yearly rate of interest (rate ÷ 100)
n
Times interest is compounded each year (1 for yearly, 2 for half-yearly)
t
Time period in years (5)

Formula to Calculate NSC with an Example

Consider an example for a better understanding.

  • Amount Invested: ₹1,00,000
  • Rate of Interest: 7.7% per annum, compounded yearly
  • Time Period: 5 years

Using the formula:

A = 1,00,000 × (1 + 0.077)^5

After calculation, the maturity amount is ₹1,44,903, so you earn ₹44,903 as interest. With half-yearly compounding, it would be ₹1,45,903.

Things to keep in mind

  • Tax benefit: The amount you invest can be claimed as a deduction under Section 80C in the old tax regime, up to ₹1,50,000 a year.
  • Interest is taxable: The interest is taxable. Each year’s interest, except the last, counts as reinvested and also qualifies for the 80C deduction.
  • Locked for 5 years: You can’t withdraw before maturity, except in special cases such as the holder’s death or a court order.
  • Use as security: Banks accept NSC as security for loans, so you can borrow against it without breaking it.