Current interest rates on various Small Savings Schemes are better than those of similar financial instruments being offered by banks, the Central Government said on Monday (February 13) in response to a query on the steps being taken to increase the interest rates.
Small Savings schemes include deposit options like Public Provident Fund, Senior Citizen Savings Scheme (SCSS), National Savings Certificate, Sukanya Samriddhi Yojana (SSY), Kisan Vikas Patra and various Post Office deposit schemes.
“Prevailing interest rates on Small Savings Schemes are better than those being offered through similar financial instruments being made available by leading Scheduled Commercial Banks. Rates applicable of Small Savings Schemes are being periodically revised,” Union Minister of State for Finance, Pankaj Chaudhary, said in a written reply to the query in Lok Sabha.
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Chaudhary further said that interest rates on select small savings schemes were last revised for Q4 FY 2022-23.
How are interest rates for small savings schemes decided?
“Several factors determine the interest rates that are applicable on Small Savings Schemes. These inter-alia includes, recommendations of Syamala Gopinath Committee, existence of taxation benefits for small investors and resultant rates(s) of return, interest, cost, etc,” the minister said.
Current Interest Rates on Various Small Savings Schemes
Post Office deposit schemes
- 5-year Time Deposit: 7%
- 3-year Time Deposit: 6.9%
- 2-year Time Deposit: 6.8%
- 1-year Time Deposit: 6.6%
- 5-year Recurring Deposit: 5.8%
- Monthly Income Scheme account: 7.1%
Public Provident Fund (PPF): The current interest rate offered by the Government on PPF deposits is 7.1%
Senior Citizen Savings Schemes (SCSS): The current interest rate offered by the Government on SCSS deposits is 8%
National Savings Certificate (NSC): The current interest rate offered by the Government on NSC deposits is 7%
Sukanya Samriddhi Yojana (SSY): The current interest rate offered by the Government on SSY deposits is 7.6%
Kisan Vikas Patra (KVP): The current interest rate offered by the Government on KVP deposits is 7.2%
