Economy News

Government Raises Interest Rates on Some Small Savings Plans to 0.3% – Mintpaisa

Photo used for representation purposes only.

Photo used for representation purposes only.

On June 30, the government raised interest rates on some savings schemes to 0.3% for the July-September quarter, in line with high interest rates in the banking system.

The largest increase of 0.3% was for the five-year recurring deposit (RD). In the second quarter of the current financial year, RD holders would get 6.5% compared to 6.2% currently, according to the notification from the Ministry of Finance.

With the revision, a one-year term deposit with post offices will now earn 0.1 percentage point more at 6.9%, and for the two-year term – 7% (from 6.9%).

However, interest rates on three-year and five-year term deposits were maintained at 7% and 7.%. Interest rates for popular PPFs and savings deposits are maintained at 7.1% and 4%, respectively.

The National Savings Bond (CSN) interest rate remained unchanged at 7.7% for the period from July 1 to September 30, 2023.

The new rate for the Sukanya Samriddhi Girls’ Savings Program also remained at the current level of 8%.

The interest rate of the savings plan for the elderly and Kisan Vikas Patra (KVP) is 8.2% and 7.5%, respectively.

Interest rates were raised during the last quarter (January-March) as well as the April-June quarter.

Interest rates for small savings plans are communicated on a quarterly basis.

There is no interest rate increase for the monthly income scheme, and it will earn investors 7.4%.

Since May, the Reserve Bank has raised the key lending rate from 2.5% to 6.5%, prompting banks to raise interest rates on deposits as well.

The RBI maintained the status quo on the policy rate for the last two consecutive meetings of the Monetary Policy Committee.

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