Post Office And Other Small Savings Scheme Interest Rates Revised
In its quarterly update, the government has revised interest rates of some post office schemes while leaving rates of popular schemes unchanged. Interest rates on small savings schemes are being revised on a quarterly basis at present.
Finance Ministry has sent out an official notice stating that it was informed that the interest rate on 1-year post office time (fixed) deposit has been hiked to 7% the January-March 2019 quarter session as compared to the previous interest rate of 6.9 per cent. On the other hand, the interest rate on the 3-year fixed deposit has been lowered to 7 per cent from 7.2 per cent.
The government had hiked interest rates on various small savings scheme, including Public Provident Fund (PPF), Kisan Vikas Patra (KVP), National Savings Certificate, Monthly Income Scheme, Senior Citizen Savings Scheme (SCSS) and Sukanya Samriddhi Scheme (SSS), by 40 basis points (bps) for the October-December quarter, making them attractive for investors who want to invest in safe products.
Financial planners say that investors should go in for a well-balanced portfolio with some investments in safe products and some in equity. Every quarter the government revises interest rates on small savings schemes. In the previous revision announced in September interest rates on these deposits were hiked by up to 0.4 per cent for the October-December quarter of last year.
The interest rate on Public Provident Fund (PPF), Kisan Vikas Patra, Sukanya Samridhi Account, 5-year National Savings Certificate, savings account are compounded annually. On term deposits, the interest rate is compounded quarterly.
Small savings schemes offered by India Post are a popular savings tool among the Indians. Individuals having savings of as low as Rs 10 per month can save in these schemes.