‘No change in interest rates of small savings schemes in October-December quarter’- Finance Ministry

New Delhi| The Central Government has taken a big decision related to banks for the October-December quarter. The Finance Ministry has kept the interest rates on small savings schemes unchanged. It is noteworthy that interest rates on small savings schemes are usually reviewed every quarter. These small savings schemes provide guaranteed returns at regular intervals. Interest is paid monthly, quarterly or annually to customers/account holders. The formula of interest rates for small savings scheme was given by Shyamala Gopinath Committee.

The interest rate for the Public Provident Fund (PPF), one of the most popular small savings schemes, will remain at 7.1 per cent. This scheme is widely preferred due to its tax benefits and long term savings potential.

The Senior Citizens Savings Scheme (SCSS) will also maintain its interest rate at 8.2 per cent. The scheme is specifically designed to provide financial security to senior citizens, providing higher returns than other savings options.

Deposits made under the Sukanya Samriddhi Yojana, which aims to encourage savings for girl child education and marriage expenses, will continue to receive an interest rate of 8.2 per cent. This scheme is an integral part of the ‘Beti Bachao Beti Padhao’ initiative of the government. The National Savings Certificate (NSC), which is a fixed-income investment scheme, will retain its interest rate at 7.7 per cent. This plan is considered a safe investment with moderate returns.

The Post Office Monthly Income Scheme (PO-MIS), which provides regular monthly income to investors, will provide an interest rate of 7.4 per cent. Kisan Vikas Patra (KVP), a government-backed savings scheme designed to double investment over a specific period, will continue to provide an interest rate of 7.5 per cent.

Additionally, the 5-year Recurring Deposit (RD) scheme, which allows investors to deposit a fixed amount every month, will provide an interest rate of 6.7 per cent. These small savings schemes offer guaranteed returns at regular intervals, combined monthly, quarterly or annually. The Shyamala Gopinath Committee had suggested that the yield on government bonds should be the benchmark for interest on several small savings instruments and should be rescheduled to the 1st of every April.