Huge rush for Small Savings Schemes in FY22 amid falling bank FD rates

Take into account tax benefit and payout frequency as well when selecting a scheme

Small Savings instruments found favour with investors in financial year 2020-2021 (FY21). Deposits saw a 21.8 per cent surge while inflows into certificates (like National Savings Certificate or NSC) rose 21.2 per cent against the backdrop of the pandemic. According to government estimates contained in this year’s Budget documents, inflows are likely to be reasonably strong in FY22 as well.

Higher returns than bank FDs  

With interest rates on bank deposits falling sharply over the past few years, investors turned to small savings instruments for their above-market rates. Adhil Shetty, chief executive officer (CEO), BankBazaar says, “The pandemic was a game changer