The decline is, among other things, due to investors choosing alternative instruments for effecting savings, he added.

Central and State Governments has taken various measures to promote and popularise small saving scheme through print and electronic media as well as by holding seminars, meetings and providing training to the various agencies involved in mobilising deposits under various small savings schemes.

The decline of gross deposit in small savings schemes is, among other things, due to investor's choice of alternative instruments for effecting savings.

The Government has taken following measures to make the small saving schemes more attractive:-

• Increase in rate of interest on post office savings account (POSA) to 4% from 3.5%.
• The maturity period for Monthly Income Scheme (MIS) and National Savings Certificate (NSC) has been reduced from 6 years to 5 years
• A new NSC instrument, with maturity period of 10 years, has been introduced.
• The annual ceiling on investment under Public Provident Fund (PPF) Scheme has been increased from 70,000 to Rs 1 lakh
• Liquidity of Post Office Time Deposit (POTD) - 1, 2, 3 & 5 years - has been improved by allowing pre-mature withdrawal at a rate of interest 1% less than the time deposits of comparable maturity. For pre-mature withdrawals between 6-12 months of investment, Post Office Savings Account (POSA) rate of interest has been allowed.

Total of 2,84,10,593 accounts were closed by customers during financial year 2011-12. There were 26,01,69,920 operational small savings accounts in the post offices as on March 31, 2012 and the amount deposited therein up to the end of March 2012 was Rs 1,90,732.73 crore.

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