On 31 December, the government maintained unchanged interest rates on small savings schemes of the post office. This unaltered interest rate is for the quarter between January and March. Interest rates of small savings schemes are updated on a quarterly basis. Interest rates on multiple small savings schemes for the fourth quarter of 2020-21, effective on 1 January and ending on 31 March 2021, remain the same as those announced for the third quarter (October to December), the Government stated in a declaration. Small savings schemes provided by the government besides PPF are Sukanya Samriddhi Yojana (SSY), National Savings Certificate (NSC), Post Office Time Deposits and Senior Citizen Savings Scheme (SCSS). The successful Sukanya Samriddhi Yojana girl child savings scheme continues to deliver the highest return among all the schemes of the post office. Below is the current interest rate provided by various small savings schemes for Q4 of 2020-21:
Public Provident Fund (PPF): This is among the best known long-term investment plans with a maturity period of 15 years and an interest rate of 7.1%. After 5 years, investors can make a partial withdrawal, although they can even extend the account over a duration of 15 years. To keep the account active, a minimum deposit of Rs 500 per year is necessary for the eligible investors.
Senior Citizen Savings Scheme (SCSS): In order to earn regular interest income on a quarterly basis, investors with a minimum age limit of 60 can deposit in this scheme up to a limit of Rs 15 lakh. Currently, this scheme fetches an interest rate of 7.4%.
Sukanya Samriddhi Yojana (SSY): For a household, a limit of 2 accounts are allowed for two daughters individually for which this scheme will continue to fetch an interest rate of 7.6%. In the name of a girl child below the age of 10 years, a guardian can make a minimum deposit of Rs 250 up to a limit of Rs 1.5 lakh in this scheme.
Post Office Time Deposits: For a maturity period of 1, 2, 3 or 5 years, you can even open time deposits at a post office. Term deposits of 1-3 years from the post office offer an interest rate of 5.5%, whereas an interest rate of 6.7% is provided for a five-year term deposit. This scheme is similar to a bank fixed deposit where investors can make a minimum deposit of Rs 1000 and in multiple of Rs 100 with no upper limit.
5-Year Post Office RD: By depositing a minimum amount of Rs 100/- per month with no upper limit this Post Office Recurring Deposit Scheme will fetch you an interest rate of 5.8% as of now.
National Savings Certificate (NSC): 5 Years National Savings Certificate (VIII Issue) will provide you with an interest rate of 6.8 % compounded annually but payable at maturity. For a maturity period of 5 years, you can make a minimum deposit of Rs. 1000/- and in multiples of Rs. 100 with no upper limit in this scheme.
Kisan Vikas Patra (KVP): This scheme will double your deposit in 124 months (10 years and 4 months) with a current interest rate of 6.9% compounded annually. One can invest in this scheme with a minimum amount of Rs. 1000/- and in multiples of Rs. 100/ with no upper limit.