PPF rates remain unchanged. Sukanya Samriddhi continues to fetch 7.6%
1 min read.Updated: 01 Jul 2020, 09:34 PM IST
Edited By Anulekha Ray
Small savings schemes rates have been kept unchanged despite fall in bank FD rate
Sukanya Samriddhi Account will continue to fetch the highest interest rate among small savings schemes
The government today kept interest rates unchanged for small savings schemes, including that of popular Public Provident Fund or PPF, for the July-September quarter despite a fall in the interest rate in the overall financial system. Post office savings accounts will continue to fetch 4% interest, while the interest rate on post office deposits between 1 year and five years remain between 5.5% to 6.7%.
The 5-year recurring deposit will fetch 5.8% interest. The interest rate on Senior Citizen Savings Scheme will continue to fetch 7.4% interest while Monthly Income Scheme or MIS will offer 6.6% interest. Public provident fund or PPF will offer 7.1% interest rates while NSC or National Savings Certificate 6.8%.
Kisan Vikas Patra will offer 6.9% interest rate and will mature in 124 months. Among the small savings schemes Sukanya Samriddhi Account will fetch the highest interest rate, at 7.6%.
Latest Small Savings Schemes Interest Rate
Amid excess liquidity in the financial system and weak credit growth, banks have been sharply cutting interest rates. For example, SBI retail fixed deposits with maturity between 5 years and 10 years currently offer interest rate of 5.4%.
Since 2016, the government has been revising interest rates on small savings schemes on a quarterly basis, depending on the trend in interest rate in the financial system. Prior to that, interest rates were revised once a year. The government had cut interest rates on small savings schemes for the April-June quarter by up to 140 basis points. The interest rate on PPF was cut by 80 basis points for the April-June quarter to 7.1%.
Earlier this month, the government extended the investment deadline to July 31, 2020 for claiming income tax deduction under Section 80C (insurance premium, PPF, NSC etc.), 80D (Mediclaim), 80G (Donations) for FY 2019-20 to July 31.