Small Savings Schemes: The government is going to review the interest rates of small savings schemes like Public Provident Fund (PPF), National Saving Certificate (NSC), Senior Citizen Savings Scheme (SCSS) on 30 June 2025. This review occurs every quarter and remains applicable for the next three months. In the review going to be held this time, new interest rates will be set for July to September 2025.

RBI cut repo rate several times

So far, the interest rates on the post office saving scheme are the same from the beginning of the year, but now it is likely to change. This is because the Reserve Bank of India (RBI) has cut the repo rate by 100 basis points this year. The first has cut 25 basis points in February, 25 basis points in April and 50 basis points in June. Repo rate cuts have also affected the bond yield and banks have reduced interest rates on FDED Deposit.

The bank is currently giving an interest of 7.1 percent on the Public Provident Fund (PPF), which is very close to the lowest interest rate seen in the last 5 decades. Earlier, before August 1974, the interest rate on PPF was seen less than 7 percent. PPF is one of the most popular small saving schemes for long -term investment, but may be reduced to the interest rate on it in the next review.

On what basis does the government decide the interest rate?

The interest rate on PPF is based on the formula suggested by the Shyamala Gopinath Committee. According to this formula, the interest rates on PPF should be 25 basis points higher than the average yield of 10 -year government bonds. Currently, the Bond Yield is at around 6.325 %. This indicates that investors get low returns.

According to the formula, the interest rate of PPF may fall by 6.575 percent, which is 7.10 % to 52.5 basis points. In such a situation, it is better to invest in these schemes before the advice of experts, possible cuts.

Explain that small savings schemes are special for those investors who want guaranteed returns by staying away from the fluctuations of the stock market. The government reviews the interest rate being received on it every three months so that these schemes remain attracted to the investors.

The government fixes interest rates based on the recommendations of the Shyamala Gopinath Committee, which states that interest rates for small savings schemes should be 1 percent more than 0.25 % in the same period of interest rates for small savings schemes. By the way, the interest rate on PPF remains at an equal 7.10 percent from 1 April 2020. Earlier, the rates were 7.90 percent from 1 July 2019 to 31 March 2020. Similarly, 9.5 percent in 2000 and interest rates on it in 2003 were 8 percent.

Also read:

Know this new decision of Rera before buying a house, now the builder’s arbitrary will not run in this matter

Government Small Saving Scheme: Good news for investors! The central government has not made any changes in interest rates on small savings schemes. From the first quarter of the new financial year (FY 2025-26) starting from 1 April 2025 (FY 2025-26), all post office schemes including PPF, SSY, NSC will be applicable to the old interest rates. That is, investors will get the same return as the previous quarter (January-March 2025).

How much interest on which scheme

Interest rates are different in different schemes of post office. Sukanya Samriddhi Yojana (SSY) and Senior Citizen Savings Scheme (SCSS) are offering the highest 8.2 percent interest, which is much better than any bank FD. At the same time, there will be a return of 7.1 percent on Public Provident Fund (PPF) and 7.5 percent on 5 years time deposit. On investing in Kisan Vikas Patra (KVP), your money will double in just 9 years and 7 months.

What to do if you want high returns?

These schemes have many benefits. They are completely safe because they have the support of the Government of India. Tax benefits are also available on schemes like PPF, SSY and NSC. Schemes like Monthly Income Account Scheme (MIAS) and Senior Citizen Savings Scheme (SCSS) are the best source of regular monthly income.

This is a golden opportunity for investors. If you want high returns, you can invest in SSY or SCSS. PPF is the best option for long term saving, while 8.2 percent of the return for senior citizens is not less than a boon.

How much interest rate on which scheme

• Savings Deposit annual interest rate 4 percent
• 1 year time deposit annual interest rate 6.9 percent
• 2 years time deposit annual interest rate 7 percent
• 3 years time deposit annual interest rate 7.1 percent
• 5 years time deposit annual interest rate 7.5 percent
• 5 -year recurring deposit (RD) interest rate 6.7 percent
• Senior Citizen Savings Scheme (SCSS) Interest Rate 8.2 %
• Monthly Income Account Scheme (MIAS) Interest Rate 7.4 percent
• National Savings Certificate (NSC) Interest Rate 7.7 percent
• Public Provident Fund (PPF) Interest Rate 7.1 percent
• Kisan Vikas Patra (KVP) Interest Rate 7.5 percent
• Sukanya Samriddhi Yojana (SSY) Interest Rate 8.2 percent

Also read: Best Power Stocks: Shares of these 5 power companies will make your portfolio ‘Power House’, strong returns will shine luck!