Small savings rates unchanged for sixth straight quarter from July 1

The Union Finance Ministry on Monday left interest rates unchanged for various small savings schemes — including the Public Provident Fund (PPF), National Savings Certificate (NSC), and other government-backed savings instruments — for the sixth consecutive quarter, beginning 1 July 2025.

 

"The rates of interest on various small savings schemes for the second quarter of FY26, starting from 1 July 2025 and ending on 30 September 2025, shall remain unchanged from those notified for the first quarter (1 April to 30 June 2025)," the Finance Ministry said in a notification.

 

According to the notification, deposits under the Sukanya Samriddhi scheme will continue to fetch an interest rate of 8.2 per cent, while the rate on three-year term deposits remains at 7.1 per cent. 

 

Interest rates for the popular PPF and post office savings deposit schemes are also unchanged at 7.1 per cent and 4 per cent, respectively. The Kisan Vikas Patra (KVP) will continue to offer 7.5 per cent interest, with a maturity period of 115 months.

 

The NSC will retain its 7.7 per cent interest rate for the July–September 2025 quarter. Similarly, the monthly income scheme will offer a return of 7.4 per cent, as in the previous quarter.

 

With this decision, the interest rates on small savings schemes — largely operated through post offices and designated banks — have remained unchanged for six straight quarters. The last revision occurred in the fourth quarter of FY24, when the government had adjusted rates on select schemes.

 

Earlier this month, the Reserve Bank of India’s Monetary Policy Committee (MPC) surprised markets by cutting the repo rate by 50 basis points to 5.5 per cent, ahead of expectations of a 25-bps cut. The front-loaded rate reduction is aimed at expediting transmission to both lending and deposit rates.