The Indian government has notified that post office saving schemes such as national Savings Certificate and Public Provident Fund would be closed prior to maturity in case the holder changes his personal status and becomes a non-resident Indian.
The Indian government has amended the rules on post office saving schemes which now means that accounts like NSC and PPF will be closed for those people who become NRIs. The Times of India reported that the amended rules were notified in the official gazette earlier this month.
The amendment to the PPF Scheme, 1968, says: "If a resident, who opened an account under this scheme, subsequently becomes a non-resident during the currency of the maturity period, the account shall be deemed to be closed with effect from the day he becomes non-resident".
The interest payable would be up to the date of the account closure, it said.
A separate notification on NSCs said in case of a similar change of status of the certificate holder before the maturity period, "the certificate will be encashed, or deemed to be encashed on the day he becomes non-resident" and interest will be paid accordingly.
NRIs are not allowed to have schemes like the National Savings Certificates, Public Provident Fund, Monthly Income Schemes and other time deposits offered by the post office.