Small Savings Interest Rates: Pause After A Massive Cut

As you would be aware, last quarter the Govt. had announced a massive cut in the interest rates on the various Post Office Small Savings Schemes.

Therefore, on expected lines, it has decided to continue with the status quo for the next quarter.

Consequently, the interest rates for the current quarter i.e. July to Sept'20, shall remain unchanged compared to the previous quarter.

This will bring some relief to the investors in the Small Savings Schemes.

(By now you would surely be aware that since last few years the interest rates on Small Savings Schemes are reset periodically on a quarterly basis.)

Accordingly, the interest rates on various Post Office Small Savings Schemes for the second quarter of the Financial Year 2020-21 — i.e. July 1st to Sept 30th, 2020 — are detailed below:

Public Provident Fund (PPF) : 7.1% p.a. [compounded annually]

5-year National Saving Certificate (NSC) : 6.8% p.a. [compounded annually]

Monthly Income Scheme : 6.6% p.a. [monthly compounding and paid out]

Senior Citizens Savings Scheme : 7.4% p.a. [quarterly compounding and paid out]

Time Deposits
1-year Deposit : 5.5% p.a.
2-year Deposit : 5.5% p.a.
3-year Deposit : 5.5% p.a.
5-year Deposit : 6.7% p.a.
(All on quarterly compounding basis)

5-year Recurring Deposit : 5.8% p.a. [compounded quarterly]

Kisan Vikas Patra : 6.9% p.a. [compounded annually] 
(The scheme will double your money in 10 years 4 months)

Sukanya Samriddhi Scheme : 7.6% p.a. [compounded annually]

Savings Deposit : No change at 4% p.a. [compounded annually]


Note:
1. 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).

2. For the existing accounts under all other schemes, the contracted interest rate remains unchanged until maturity.