The Finance Ministry on Wednesday announced that the interest rates on small saving schemes for the three-month period starting July 1 will remain unchanged. This means interest rates on various small saving schemes such as National Saving Certificates (NSC) and Public Provident Fund (PPF) will continue for at least three more months starting Friday.
The small savings schemes basket comprises 12 instruments including the National Saving Certificate (NSC), Public Provident Fund (PPF), Kisan Vikas Patra (KVP) and Sukanya Samriddhi Scheme. The government resets the interest rate at the beginning of every quarter.
Theoretically, since 2016, interest rate resetting has been done based on yields of government securities of the corresponding maturity, with some spread on the scheme for senior citizens, as advised by the Shyamala Gopinath Committee. However, in practice, the interest rate changes are made considering several other factors, including political ones.
Table
Small Saving Schemes
Saving Deposits | 4 | 4 |
|---|---|---|
1 Yr Time Deposit | 5.5 | 5.5 |
2 Yrs Time Deposit | 5.5 | 5.5 |
3 Yrs Time Deposit | 5.5 | 5.5 |
5 Yrs Time Deposit | 6.7 | 6.7 |
5 Yrs Recurring Deposit | 5.8 | 5.8 |
Sr Citizen Saving Scheme | 7.4 | 7.4 |
Monthly Income A/C | 6.6 | 6.6 |
NSC | 6.8 | 6.8 |
PPF | 7.1 | 7.1 |
Kisan Vikas Patra | 6.9 (Maturity in 124 mths) | 6.9 (Maturity in 124 mths) |
Sukanya Samridhi | 7.6 | 7.6 |
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