Net Collections Under Small Savings Schemes Decline For First Time In 11 Years

Small Savings Schemes such as National Savings Certificates (NSC) and Public Provident Fund (PPF) witnessed a decline in net collection for the first time in eleven years in the fiscal year 2022-23. Net small savings collections i.e. deposits less withdrawals by subscribers in FY23 totalled Rs 3.04 trillion, down 8.5% from Rs 3.33 trillion in FY22.

West Bengal, Maharashtra, Uttar Pradesh, Tamil Nadu, and Karnataka were the top 5 states with the highest net collections in FY23. While states like Bihar, Assam, Arunachal Pradesh, Chhattisgarh, Telangana, Mizoram, and Himachal Pradesh including UT of Puducherry witnessed a rise in net collections. Except for Dadra and Nagar Haveli, all other states and UTs had a decrease in net collections.

Despite the Finance Ministry significantly increasing interest rates on small savings for the March quarter of Fiscal Year 2022-23, the decline has occurred.

Small savings deposit rates for terms of one year, two years, and three years were increased by 110 basis points to 6.6%, 6.8%, and 6.9%, respectively, for the fourth quarter of fiscal year 23.

The "National Small Savings Fund" (NSSF), which was established in the Public Account of India with effect from April 1, 1999, receives credit for all contributions made under small savings schemes.