National Savings Certificates
These certificates have a 5-year term. The interest accrues annually but is deemed to be reinvested in the scheme. At the end of five years, the accumulated amount is paid to the holder. The NSC can be transferred by the holder once during the investment period. The initial investment fetches a tax exemption upto Rs 1.5 lakh under section 80C. The interest is theoretically taxable. However, as it is deemed to be reinvested in the scheme every year, if you have room under section 80C, the reinvested interest can qualify for section 80C benefits.