Government raises interest rates on 5 small savings schemes this quarter

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Government raises interest rates on 5 small savings schemes this quarter

The interest rates on five small savings schemes run by the government have been raised by 10 to 30 basis points this quarter after almost nine quarters. The schemes include the Senior Citizen Saving Scheme, Kisan Vikas Patra and Monthly Income Scheme. Interest rates for government small savings schemes are revised on a quarterly basis. The interest rate on small savings schemes was revised during the first quarter of 2020 -- 21, when rates were slashed due to the Pandemic-related issues.

The government hasn't changed the interest rates for the popular schemes - Public Provident Fund PPF National Savings Certificate and Sukanya Samriddhi Scheme.

With the Q 3 revision of interest rates, investors opting for three-year time deposit with post offices would get 5.8 per cent instead of the 5.5 per cent, which is an increase of 30 basis points.

6 per cent, a 20 basis point increase from the existing rate of 7.4 per cent in Q 3.

The tenure and interest rates for those buying Kisan Vikas Patra KVP have been adjusted by the government. The revised rate for KVP has been fixed at 7 per cent and the maturity period is 123 months. The maturity period was 124 months and the interest rate was 6.9 per cent earlier in the day.

The interest for the Monthly Income Scheme is now 6.7 per cent higher than the existing 6.6 per cent.

In the October-December quarter of this fiscal, the interest rates of popular schemes like Public Provident Fund PPF and National Savings Certificate NSC will remain the same, at 7.1 per cent and 6.8 per cent.

The one-year term deposit scheme of the post office will earn the investor an interest rate of 5.5 per cent in Q 3 as before, according to the Finance ministry notification.

7 percent of the earnings are paid quarterly. The interest rate for the five-year recurring deposits will be 5.8 per cent.

The interest rate for the Sukanya Samriddhi Yojana girl child savings scheme will be the same 7.6 per cent. The basic savings deposits at the post office will earn 4 per cent per annum.

In a separate notification, the finance ministry said if a Senior Citizens' Savings Scheme SCSS account holder passes away, the account will be closed on request of the nominee's legal heir. The interest rate on the SCSS scheme would be paid until the date of death of the account holder.