Government reduces interest rates on small savings schemes for April-June 2021 period

Savings deposits rate is reduced by 50 bps to 3.5%

The government has announced a sharp reduction in the interest rates on small savings schemes up to 110 bps for April-June 2021 period. Interest rates for small savings schemes are announced on a quarterly basis.

Interest rate on Public Provident Fund (PPF) has been slashed by 70 bps to 6.4%. The interest rate on National Savings Certificate (NSC) has been reduced sharply by 90 bps to 5.9%.

The interest rate for the five-year Senior Citizens Savings Scheme has been cut by 90 bps to 6.5%.

The interest rate on savings deposits has also been reduced by 50 bps to 3.5%.

The cut in interest rate has been steep at 110 bps for one-year term deposit to 4.4% from 5.5%. The interest rate for two-year fixed deposit has been cut by 50 bps to 5%, three-year term deposit rate by 40 bps to 5.1% and five- year term deposit rate by 40 bps to 5.8%.

Further, the interest rate Sukanya Samriddhi Yojana scheme is reduced by 70 b[s to 6.9%.

The annual interest rate on Kisan Vikas Patra (KVP) has been reduced by 70 bps to 6.2% from 6.9% earlier.

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