The Reserve Bank of India (RBI) is cutting key policy rates to mitigate the COVID-19 impact. Also most of the banks and financial institutions have already been reducing the interest rates on their deposit schemes.
Hence, as was widely speculated, the central government had earlier announced a drastic cut in interest rates on small savings schemes for the first quarter (April to June) of the financial year 2020-21. Interest rates on various small savings schemes have been cut anywhere between 70 basis points and 140 basis points (100 basis points = 1 per cent).
However, there has been no change in the interest rates on small savings schemes by the government for the second, third and fourth quarters of the financial year 2020-21 and also for the first quarter of the financial year 2021-22.
The government has also not changed the interest rates of post office small savings schemes for the July-August-September 2021 quarter. In the scenario of falling interest rate, any change in the interest rates of post office small savings schemes is not good news for fixed income investors.
National Savings Schemes (NSS) are one of the very popular savings schemes in India. These are controlled by the Ministry of Finance. They provide complete security of investment combined with attractive returns.
These schemes also act as a means of financial inclusion, especially through their implementation in geographically inaccessible areas, mainly through post offices, which have reached far and wide.
Some of the very popular schemes that come under NSS are given below;
PPF (Public Provident Fund) Sukanya Samriddhi Yojana Monthly Income Scheme (Monthly Income Account) Senior Citizen Savings SchemeKVP (Kisan Vikas Patra) NSC (National Savings Certificate) Time Deposit and Recurring Deposit Latest Post Office Small Savings Schemes Interest Rates July-September 2021 | Second quarter of FY 2021-22
The latest interest rates applicable on various small savings schemes with effect from 1.07.22021 for the quarter July to September 2021 are given below;
Savings SchemeInterest Rates
1st April 2021 to 30th June 2021New interest rates
1st July 2021 to 30th September 2021Sukanya Samriddhi Account-Girl Scheme
7.6%7.6% 5 Year Senior CSS7.4%7.4% PPF7.1%7.1% Saving Deposit4.0% 4.0% 1 Year Fixed Deposit 5.5% 5.5% 2 Year Fixed Deposit 5.5% 5.5% 3 Year Fixed Deposit 5 5.5%5.5% 5 Year Fixed Deposit 6.7% 6.7% 5 Year Recurring Deposit 5.8% 5.8% 5 Year MIS 6.6% 6.6% 5 Year NSC 6.8% 6.8% Kisan Vikas Patra (KVP) 6.9% 6.9% New Post Office Small Savings Scheme Interest Rate Table (July – September 2021) Latest Interest Rate on Sukanya Samriddhi Yojana, PPF, MIS, NSC | Quarter-2 of FY 2021-22
The revised interest rates applicable on various small savings schemes for the first quarter of July to September 2021 will be effective from 01-07-2021;
The latest interest rate on Sukanya Samriddhi Yojana (SSA) is 7.6%. The new rate of interest on PPF (Public Provident Fund) will be 7.1%. The interest rate on Senior Citizen Savings Scheme (SCSS) has been reduced to 7.4%. The new interest rate on Kisan Vikas Patra (KVP) will be 6.9%. The interest rate on the 5-year National Savings Certificate (NSC) is 6.8%. The new interest rate on Post Office MIS (Monthly Income Scheme) is 6.6%. Rate The rate of interest on a 5 year Post Office RD (Recurring Deposit) will be 5.8%.
Please note that interest rates on Small Savings Schemes are now reviewed and reset on a quarterly basis (if any).
The revised rates (if any) are applicable for all new investments made during the relevant period. For existing investments under all schemes (except PPF and Sukanya Samriddhi Yojana), the interest rate contracted remains unchanged till maturity.
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(Post First Published: 01-July-2021)