Changes In Interest Rates Of Small Savings Schemes: January-March 2024

Utkarsh Classes Last Updated 30-12-2023

Changes In Interest Rates Of Small Savings Schemes: January-March 2024

Banking and Finance 4 min read

The Government of India announced the interest rates for small savings schemes for the January-March 2024 quarter on 29 December 2023. Sukanya Samriddhi Yojana has been increased by 0.20% and 3-year time deposit rates have been increased by 0.10%. The rates of other schemes have remained the same.

Earlier, the interest rate of the Sukanya Scheme was 8% and the interest rate of a three-year time deposit was 7%. This is the sixth consecutive quarter when the rates of these schemes have increased.

Latest interest rates on small savings schemes:

For the January-March 2024 quarter

Savings deposit: 4 percent
1-year post office fixed deposit: 6.9 percent
2-year post office fixed deposit: 7.0 percent
3-year post office fixed deposit: 7.1 per cent (earlier 7.0 percent)
5-year post office fixed deposit: 7.5 percent
5-year recurring deposit: 6.7 percent (earlier 6.5 percent)
National Savings Certificate (NSC): 7.7 percent
Kisan Vikas Patra: 7.5 percent (mature in 115 months)
Public Provident Fund (PPF): 7.1 percent
Sukanya Samriddhi Account: 8.2 percent (earlier 8.0 percent)
Senior Citizens Savings Scheme: 8.2 percent
Monthly Income Account: 7.4 percent

Review of interest rates:

The interest rates of the Small Savings Scheme are reviewed every quarter.
The Shyamala Gopinath Committee gave the formula for determining the interest rates of the Small Savings Scheme.
The committee had suggested that the interest rates of these schemes should be 0.25-1.00% higher than government bonds of similar maturity.

Small savings instruments can be divided into three parts:

Postal Deposit: Saving Account, Recurring Deposit, Time Deposit and Monthly Income Scheme
Saving Certificate: National Small Savings Certificate (NSC), Kisan Vikas Patra (KVP)
Social Security Schemes: Sukanya Samriddhi Yojana, Public Provident Fund (PPF) and Senior Citizens Savings Scheme (SCSS)

Sukanya Samriddhi Yojana:

Sukanya Samriddhi Yojana was launched by Prime Minister Narendra Modi on 22 January 2015 as a part of the Beti Bachao Beti Padhao campaign.
This scheme aims to promote the welfare of the girl child in India.
Parents or legal guardians can open a deposit account for two girl children below the age of 10 years and in case of twin or triple girl children, the scheme provides the facility to open three accounts.
The minimum investment in this is ₹250 per year. The maximum investment is ₹1,50,000 per year.
Deposits can be made for a maximum of 15 years on completion of 21 years from the date of account opening or on marriage of the account holder, whichever is earlier.