In response to the current coronavirus epidemic, the Centre has left interest rates for small savings schemes, such as NSC, SCSS, KVP, PPF and so on unaltered for the second quarter of 2021-22. The small savings interest rates for the quarter ending September 30, 2021 are the same as they were kept at the quarter ending April to June 2021. Amid a low-interest rate regime, no adjustment in the interest rate on post office small savings schemes will be definitely beneficial for risk-averse investors, especially senior citizens.
Although it is well known that until maturity the interest rate for National Savings Certificate, Kisan Vikas Patra, Post Office Time Deposits, and Senior Citizens Savings Scheme (SCSS) stays constant. Whereas the interest rate of the Public Provident Fund (PPF) and Sukanya Samriddhi Yojana (SSY) are subjected to the adjustment made by the government on a quarterly basis. Small savings schemes will maintain the same flow to provide higher rates to investors than other secure debt instruments options such as bank fixed deposits (FDs). For example, the PPF will yield 7.10 per cent, the NSC would earn 6.8%, and the Post Office Monthly Income Scheme Account will yield 6.6 per cent.
The interest rate on the Senior Citizen Savings Scheme is 7.4 per cent per year. The rate of interest on a one-year time deposit is 5.5 per cent, while the rate on a five-year time deposit is 6.7 per cent each year. While the Sukanya Samriddhi Yojana account for girl children would continue to provide 7.6 per cent. The rate of interest on savings accounts will remain at 4% per year.
Small Savings Schemes Interest Rates
|Small Savings Schemes||ROI in % for the quarter ending September 30, 2021||Compounding frequency|
|Post Office Savings Account||4||Yearly|
|Time Deposit (1 Year)||5.5||Quarterly|
|Time Deposit (2 Year)||5.5||Quarterly|
|Time Deposit (3 Year)||5.5||Quarterly|
|Time Deposit (5 Year)||6.7||Quarterly|
|Post Office Recurring Deposit (5 Year)||5.8||Quarterly|
|Senior Citizens Savings Scheme (5 Year)||7.4||Quarterly|
|Post Office Monthly Income Scheme||6.6||Monthly|
|5-year National Savings Certificate||6.8||Yearly|
|Public Provident Fund||7.1||Yearly|
|Kisan Vikas Patra (124 months)||6.9||Yearly|
|Sukanya Samriddhi Yojana||7.6||Yearly|