Everything About SBI MIS Scheme – Monthly Income Made Simple

If you're looking for a secure and regular source of income from your savings, the SBI MIS Scheme (Monthly Income Scheme) is something worth considering. Many people, especially retirees or those with a low-risk appetite, prefer stable returns over risky investments. The SBI MIS Scheme enables you to invest a lump sum and generate a fixed monthly income.

As someone with experience in financial planning, I’ve explored this scheme in detail, and in this blog, I will break it down for you in the simplest way possible. Whether you're planning for post-retirement income or want a safe investment for your idle money, this guide will help you understand everything about the SBI MIS Scheme.

What is the SBI MIS Scheme?

The SBI Monthly Income Scheme (MIS) is a fixed deposit plan that offers monthly interest payouts to the investor. It is suitable for individuals who want a regular income instead of allowing the interest to accumulate. The main advantage of this scheme is that it provides a steady and predictable monthly return.

Key Features of the SBI MIS Scheme

Let’s go through some of the key features that make this scheme appealing:

• Monthly interest payout: You receive the interest earned on your deposit every month.
• Tenure: The typical tenure ranges from 12 months to 10 years, depending on your selection.
• Minimum deposit: According to current SBI policy, the minimum deposit typically starts at ₹1,000.
• Interest rate: The rate of interest depends on the duration of the deposit and the RBI’s current guidelines.
• Premature withdrawal: Allowed after a certain lock-in period, but with penalty charges.
• Safe investment: Being a product of SBI (State Bank of India), it offers high trust and low risk.

 

Eligibility Criteria

To invest in the SBI MIS Scheme, you need to meet the following criteria:

• Resident Individuals: Only Indian citizens can apply. NRIs are generally not eligible.
• Joint Account Holders: You can open the account jointly with family members.
• Minors: Can invest under the guardianship of parents.

This scheme is especially suitable for retired employees, homemakers, and senior citizens looking for a steady income.

Interest Rates on SBI MIS Scheme

The tenure and deposit amount have an impact on the interest rate. As per the current trends (referencing my own experience and updates like those shared by platforms such as Square Insurance), the interest rates range between 6.5% to 7.5% per annum, depending on the chosen duration.

The interest is calculated monthly and credited to your bank account directly.

Example:

If you invest ₹5,00,000 for a tenure of 5 years at 7% interest, your monthly income would be around ₹2,917.

(Note: Always check the latest rates at your nearest SBI branch before investing.)

How to Open an SBI MIS Account?

Opening an SBI MIS account is quite easy. Here's how you can do it:

Online Method:

1. Log in to SBI Net Banking or YONO App.
2. Go to the “Fixed Deposit” section.
3. Choose the “Monthly Interest Payout” option.
4. Enter the deposit amount and select the tenure.
5. Confirm the details and complete the transaction.

Offline Method:

1. Visit your nearest SBI branch.
2. Fill in the FD application form.
3. Submit KYC documents (Aadhaar, PAN, Address Proof).
4. Deposit the amount via cheque or transfer.
5. Collect your deposit certificate.

 My Personal Experience with SBI MIS Scheme

As someone who has personally invested in the SBI MIS Scheme for both my parents and myself, I can say that it is one of the most stable and reliable sources of monthly income. The interest is always credited on time, and the online process via the SBI YONO app is smooth.

For my parents, this scheme acts like a monthly pension, giving them financial independence and a sense of security. I’ve found it particularly useful when planning long-term, low-risk financial goals.

I also appreciate the transparency and easy tracking of the deposit through SBI’s digital platforms. In uncertain times, having a guaranteed income every month provides peace of mind — and that’s exactly what the SBI MIS Scheme delivers.

Tax Implications

Here’s what you should know about taxation under the SBI MIS Scheme:

• Depending on your income tax slab, the interest earned is taxable.
• TDS (Tax Deducted at Source) is applicable if the interest exceeds ₹40,000 in a financial year (₹50,000 for senior citizens).
• You can submit Form 15G/15H to avoid TDS if your total income is below the taxable limit.

Premature Withdrawal – Is It Allowed?

Yes, you can break the deposit before maturity, but a penalty will be applied. SBI usually charges around 0.50% to 1% of the interest rate, depending on how early you withdraw.

Therefore, it is better to go for this scheme only if you are sure you won’t need the money for the chosen tenure.

Documents Required

To open an account under SBI MIS, you will need:

• PAN Card
• Aadhaar Card
• Address Proof
• Passport-size photo
• Bank account details (if not already linked)

Who Should Invest in SBI MIS Scheme?

This scheme is ideal for:

• Retired individuals seeking fixed monthly returns.
• Homemakers or senior citizens without a fixed pension.
• People with low risk tolerance who want guaranteed income.
• Investors who want to park idle funds safely.

Comparison With Other Investment Options

Feature	SBI MIS Scheme	Mutual Funds	Recurring Deposit
Risk	Low	Medium to High	Low
Returns	Fixed	Market-linked	Fixed
Liquidity	Moderate (with penalty)	High	Moderate
Tax Benefit	No	Yes (in ELSS)	No

Final Thoughts

If you're looking for regular monthly income without taking much risk, the SBI MIS Scheme is a dependable choice. It’s easy to understand, backed by one of the most trusted banks in India, and suitable for long-term safe investment planning.

From personal experience, I would recommend this scheme to anyone who values security, consistency, and peace of mind in their financial life. It may not offer high returns like market-linked investments, but it does offer reliability, which is priceless for many investors.

Always assess your financial goals and speak with a professional before making investment decisions. Platforms like Square Insurance also share useful and updated financial knowledge that can help you stay informed.