“Small Savings Interest Rates Increased by Government”

The Indian government has recently increased interest rates on most post office saving schemes by up to 0.7 per cent for the April-June 2023 quarter, in line with the rising interest rates in the economy. While the popular Public Provident Fund (PPF) and savings deposits will retain their interest rates at 7.1 per cent and 4 per cent respectively, there has been an increase between 0.1 per cent and 0.7 per cent in other saving schemes, according to a statement by the finance ministry. The National Savings Certificate (NSC) saw the highest increase, with its interest rate rising from 7 per cent to 7.7 per cent for the April 1 to June 30, 2023 period. The Sukanya Samriddhi girl child savings scheme has also seen an increase from 7.6 per cent to 8 per cent. The senior citizen savings scheme and Kisan Vikas Patra (KVP) now offer an interest rate of 8.2 per cent (up from 8 per cent) and 7.5 per cent (up from 7.2 per cent), respectively, with KVP maturing in 115 months instead of the previous 120 months. Small savings scheme interest rates are revised quarterly, and the last revision was in the previous quarter. With the new revision, a one-year term deposit with post offices will earn 6.8 per cent, while two years will earn 6.9 per cent, three years will earn 7 per cent, and five years will earn 7.5 per cent. The RBI has raised the benchmark lending rate by 2.5 per cent to 6.5 per cent since May, prompting banks to raise interest rates on deposits as well.