Govt lowers interest rates on small saving deposits

SansadTV Bureau

Government of India on Friday lowered interest rate on small savings deposits, including Public Provident Fund, by 0.1 percent effective April 1.

Finance Minister Arun Jaitley speaks to media at parliament house after GST bill passed in New Delhi on Wednesday. After an eight-hour debate, the Lok Sabha has passed all four GST-related bills crucial to the launch in July of the country's biggest tax reform since Independence.

Finance Minister Arun Jaitley speaks to media at parliament house after GST bill passed in New Delhi on Wednesday. After an eight-hour debate, the Lok Sabha has passed all four GST-related bills crucial to the launch in July of the country’s biggest tax reform since Independence.

Government has been recalibrating interest rates of all small saving schemes on a quarterly basis from 2016. However the rate of interest was kept unchanged in this year’s January-March quarter compared with the October-December quarter.

A notification from Minister of Finance said that investments in public provident fund (PPF) scheme will continue to fetch an annual interest rate of 8 per cent, the same as 5-year National Savings Certificate. On the other hand investments in Kisan Vikas Patra (KVP) investments will continue to yield 7.7 per cent and mature in 112 months.

As per the notification, savings deposit will fetch 4 per cent interest annually while term deposits of 1-5 years will offer 7-7.8 per cent that will be paid quarterly. The 5-year recurring deposit will continue to earn you 7.3 per cent rate.

Sukanya Samriddhi Scheme, meant for financial security of a girl child, will continue to give out 8.5 per cent annually while it will be the same as 8.5 per cent for the 5-year Senior Citizens Savings Scheme. Interest rate on senior citizens savings scheme is paid quarterly.