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Interest rates unchanged for small savings schemes, including NSC, PPF

The move is expected to see banks lowering their deposit rates in line with the small savings rate offered by the government

Press Trust of India  |  New Delhi 

Investments in small savings schemes rise to Rs 1.55 trillion in 2017-18

The government has kept the interest rates on small savings schemes, including and PPF, unchanged for the July-September quarter.

The move is aimed at matching the hardening interest rates in the banking sector.

Interest rates for are notified on a quarterly basis.

"...the rates of interest on various for the second quarter of financial year 2018-19 starting July 1 and ending on September 30, 2018 shall remain unchanged from those notified for the fourth quarter of financial year 2017-18," the Finance Ministry said while notifying the rates for the second quarter.
 

The interest rate for the five-year has been retained at 8.3 per cent. The interest on the senior citizens' scheme is paid quarterly.

Interest on savings deposits has been retained at 4 per cent annually.

(PPF) and (NSC) will fetch annual interest rate of 7.6 per cent while (KVP) will yield 7.3 per cent and mature in 11 months.
 

The girl child savings scheme account will offer 8.1 per cent rate.

Term deposits of 1-5 years will fetch interest rate of 6.6-7.4 per cent, to be paid quarterly, while the five-year recurring deposit is pegged at 6.9 per cent.

While announcing the quarterly setting of interest rates in 2016, the Finance Ministry had said that rates of would be linked to government bond yields. The move is expected to see banks lowering their deposit rates in line with the small savings rate offered by the government. 

First Published: Wed, July 04 2018. 07:26 IST
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