Shyamala Gopinath committee’s recommended formula for arriving at interest rate for different SSS

In the year 2011, Gopinath committee suggested that rate on small saving schemes (SSS) should be linked to bond yields. Each of the scheme should fetch returns higher by 25-100 bps in comparison to yield of G-securities of similar maturity. Since 2016, the recalibration of rates is being done on a quarterly basis instead of the earlier annual revision of rates.

Expected hike in interest rates on different SSC

Bond yields to go up further

It is highly expected that G-securities bond yield taken as the benchmark for deciding interest rate on small savings schemes will gain further as the governments borrowing plan for the next fiscal becomes clear and cost for the same is considered.