Post Office Small Savings:
The Reserve Bank of India has cut the repo rate by 115 basis points so far this year. Further, interest rates are expected to remain soft. At the same time, different banks are also reducing their deposit rates. While interest rates on fixed deposits are declining, small savings schemes have been attractive compared to FDs. An example of this can be understood that there is a difference of 130 basis points in the interest rates of FD and post office time deposit scheme of SBI, the country’s largest public sector bank. In such a situation, if you are also thinking of investing in small savings, then hurry. If you miss this month then you may suffer loss.
Review of interest rates every 3 months
Actually, the post office interest rates are reviewed every 3 months. After which it is applied on the very first day of every new quarter. In fact, just as the interest rates have been reduced by the RBI recently and bond yields are at lower levels, the interest rates of small savings can be reduced in the December quarter. If this happens, then new investors may be at a disadvantage. Therefore, it is better to lock interest in deposit schemes of post office now. Because most of the schemes are such that once the interest is locked, then there is no change in the investors as well. That is, once you have chosen the scheme, then its interest rates decrease or increase further, there is no effect.
How much interest now on PPF, NSC, RD, KVP, SSY?
Post office time deposit
Interest on 1 year: 5.5%
Interest on 2 years: 5.5%
Interest on 3 years: 5.5%
Interest on 5 years: 6.7%
Recurring deposit: 5.8 percent
Monthly income scheme: 6.8 percent
PPF: 7.1 percent
NSC: 6.8 percent
KVP: 6.9 percent
SSY: 7.6 percent
Senior Citizens Scheme: 7.4%
Note: The government’s interest rate on Public Provident Fund (PPF) and Sukanya Samriddhi Yojana varies from government to government, and is considered applicable accordingly. But if you invest in a time deposit, post office recurring deposit, post office monthly income scheme, National Savings Certificate (NSC) and Kisan Patra (KVP), then the interest rate at that time will continue to be available throughout the plan period.
Interest was reduced for the June quarter
In April, interest on 5-year time deposits fell from 7.7 percent to 6.7 percent. The interest on RD declined by 1.4 per cent to 5.8 per cent. The PPF rate was reduced from 7.9 per cent to 7.1 per cent. The rate of Senior Citizens Savings Scheme was reduced from 8.6 percent to 7.4 percent. The National Savings Certificate (NSC) rates were reduced from 7.9 per cent to 6.8 per cent and Sukanya Samriddhi account scheme from 8.4 per cent to 6.9 per cent. The interest rate on the Senior Citizens Scheme fell 1.2 per cent to 7.4 per cent.