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No Cut In Small Savings Schemes Q4 Interests Rates

In line with the recent policy — to reset the interest rates applicable, on the Post Office #SmallSavingsScheme, on a quarterly basis — the Ministry of Finance has announced the rates for the three-month period from Jan to Mar 2017.

Market interest rates have become highly dynamic in recent times. Hence this trend, to fix the rates after every three months, was started from the current financial year i.e. 2016-17. Till the previous year, the rate resetting was an annual exercise.

Accordingly, as the fourth and final quarter of the Financial Year 2016-17 has begun, the interest rates on various Small Savings Schemes applicable for the period 1st January to 31st March 2017 were declared by the Govt. last week.

Details of the same are provided below:

As you will note therefrom, the Govt. has decided to make NO CHANGE as compared to the previous Oct-Dec 2016 quarter. This, by the way, is quite surprising because the market interest have come down in the recent months. Therefore, expectation of rate cuts was quite high.  

Public Provident Fund : 8.0% [compounded annually]

5-year NSC : 8.0% [compounded annually]
(The 10-year NSC scheme was discontinued w.e.f. Dec 2015)

Monthly Income Scheme : 7.7% [monthly compounding and paid out]

Senior Citizens Savings Scheme : 8.5% [quarterly compounding and paid out]

Time Deposits
1-year Deposit : 7.0%
2-year Deposit : 7.1%
3-year Deposit : 7.3%
5-year Deposit : 7.8%
(All on quarterly compounding basis)

5-year Recurring Deposit : 7.3% [compounded quarterly]

Kisan Vikas Patra : 7.7% [compounded annually] 
(The scheme will double your money in 112 months)

Sukanya Samriddhi Scheme : 8.5% [compounded annually]

Savings Deposit : 4% p.a. [compounded annually]

The revised interest rates apply only to the "new accounts" opened during the respective period (except PPF and Sukanya Samriddhi Scheme, where the new rate is applied on the outstanding account balance). For the existing accounts under all other schemes, the contracted interest rate remains unchanged until maturity.

You can check the interest rates for first three quarters of the year i.e. Apr-Jun 2016, Jul-Sept 2016 and Oct-Dec 2016 in the following blog posts 
- Small Savings Schemes Rate Cut is Fantastic News
- Unchanged PO Savings Schemes Interest Rates for Q2 2016-17
- Wow! Just A Tiny Cut In Small Savings Schemes Q3 Interest Rates

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