PPF vs Post Office vs Bank FD: Recently, the government released interest rates for microsavings programmes. The interest rates for PPF, Senior Citizen Savings Scheme, Sukanya Samriddhi Yojana, and the majority of post office programmes were left unchanged by the government. This time, the government has added 0.20 percent to the interest rate on recurring deposits for 5 years. Interest on recurring deposits for five years will now be 6.7 percent, up from 6.5 percent. Even in the MPC meeting of the RBI, there is minimal chance of a change in the repo rate.
Finance Ministry Updates Small Savings Plan Interest Rates
According to the statement from the Finance Ministry, the interest rates on small savings plans have been changed for the quarter beginning on October 1 and ending on December 31 in 2023. Small savings plans offer interest rates ranging from 4% for Post Office Savings Accounts to 8.2% for Senior Citizen Savings Plans.
- Post Office Saving Account: 4 percent
- 1 year post office FD: 6.9 percent
- 2 year post office FD: 7.0 percent
- 3 year post office FD: 7 percent
- 5 year post office FD: 7.5 percent
- 5-year RD: 6.7 percent ( 6.5 percent Earlier)
- Kisan Vikas Patra: 7.5 percent (Mature in 115 months)
- Sukanya Samriddhi Account: 8.0 percent
- National Savings Certificate (NSC): 7.7 percent
- Public Provident Fund: 7.1 percent
- Monthly income account: 7.4 percent.
- Sukanya Samriddhi Account: 8.0 percent
- Senior Citizen Saving Scheme: 8.2 percent
Understanding Small Savings Schemes
Small Savings Schemes are public investment programmes managed by the government that offer guaranteed returns. The interest rate on these is set by the government. These come in three varieties. Small savings plans include monthly income plans, social security plans, and savings plans. The August inflation rate was still above 6.83 percent. This is just a little bit above the inflationary cap. However, this is far lower than the July high of 7.44 percent. Due to growing food prices and worldwide crude oil prices, inflation is strong.
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