Small savings rates steady till December, 5-year recurring deposit rate raised to 6.7%: FinMin | Mint
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Business News/ Money / Personal Finance/  Small savings rates steady till December, 5-year recurring deposit rate raised to 6.7%: FinMin
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Small savings rates steady till December, 5-year recurring deposit rate raised to 6.7%: FinMin

The interest rate on both the two-year and three-year term deposits is 7 per cent while on the five-year term deposit, the rate is 7.5 per cent.

Small savings rate steady till December 2023. Photo: iStockPremium
Small savings rate steady till December 2023. Photo: iStock

The government raised the interest rate on five-year recurring deposit scheme to 6.7 per cent from 6.5 per cent for the October-December quarter and retained the rates for all other small savings schemes on Friday, September 29. According to a finance ministry circular, the interest rate on savings deposit has been retained at 4 per cent and on the one-year term deposit at 6.9 per cent. The rates were the same during the July-September quarter. 

The interest rate on both the two-year and three-year term deposits is 7 per cent while on the five-year term deposit, the rate is 7.5 per cent. Senior citizens savings scheme will fetch an interest rate of 8.2 per cent, according to the circular.

On the monthly income account scheme, the interest rate is 7.4 per cent while it is 7.7 per cent on the National Savings Certificate and 7.1 per cent on the Public Provident Fund (PPF) scheme. The interest rate on the Kisan Vikas Patra is 7.5 per cent and the investments will mature in 115 months. 

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The interest rate on the popular girl child scheme Sukanya Samriddhi Account has been retained at 8 per cent, according to the circular. The government notifies the interest rate on small savings schemes, majorly operated by post offices, every quarter. Financial experts had widely expected the interest rats to remain unchanged till December.

In the last review on June 30, 2023, the government had hiked interest rates on several small savings schemes — 1-year and 2-year post office time deposits and 5-year recurring deposits. 

The government is also launching a one-time new small savings scheme — the Mahila Samman Bachat Patra. The Mahila Samman Bachat Patra can now be opened in 12 public sector banks and four private sector banks. The scheme was announced in the Union Budget this year, and was only available through post offices.

Broadly, small savings schemes have three categories — savings deposits, social security schemes and monthly income plan. The saving deposits include 1-3-year time deposits and 5-year recurring deposits. 

These also include saving certificates such as National Saving Certificates (NSC) and Kisan Vikas Patra. Social security schemes include PPF, Sukanya Samriddhi Account and Senior Citizens Savings Scheme. 

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Published: 29 Sep 2023, 05:57 PM IST
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