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

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.