NSC will be accepted as valid security, on the following conditions:
At the time of acceptance, the issue price (face value) of the NSC’s (VIII issue), should cover the future liability, ie. principal plus interest in case of advances and sum total of future instalments in the case of chitties. The interest for the loan amount is to be calculated till the maturity of the instrument or the remaining period of loan, whichever is longer.
Forms prescribed by the Post Office are used for noting the lien.