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Indian Govt hikes interest rate on small savings schemes by up to 70 basis points for Q1, you will earn more interest in these schemes now Small Savings scheme
Image: UNI

Indian Govt hikes interest rate on small savings schemes by up to 70 basis points for Q1, you will earn more interest in these schemes now

India Blooms News Service | @indiablooms | 01 Apr 2023, 03:36 pm

New Delhi: The government on Friday announced hike in interest rates on various small savings schemes such as Senior Citizens Savings scheme, Sukanya Samriddhi Account and National Savings Certificate by upto 70 basis points for April-June quarter (Q1) of financial year 2023-24.

One hundred basis points equal 1 percent.

The interest rate on Public Provident Fund scheme, however, remains unchanged at 7.1 pc.

As per office memorandum issued today by Finance Ministry, National Savings Certificate (NSC) saw highest rise in interest rate to 7.7 pc in Q1 of FY24 as compared to 7 pc in the January-March quarter of FY23.

Senior Citizens Savings Scheme (SCSS) interest has been increased to 8.2 pc for the quarter starting April 1, 2023.

The central government announces interest rates on various savings schemes ahead of a quarter.

As per the revised rates, Sukanya Samriddhi Account Scheme (SSAS) holders would get 8 pc interest rate as against 7.6 pc.

Interest rate for one, two, three, and five-year term deposits have also been increased from 6.6 pc, 6.8 pc, 6.9 pc and 7 pc to 6.8 pc, 6.9 pc, 7 pc and 7.5 pc respectively.

The interest rate for Monthly Income Account (MIA) scheme has also been increased to 7.4 pc from the current 7.1 pc.

The Reserve Bank of India (RBI) has been raising policy repo rate since May last year to contain inflation and maintain price stability.

“As expected, small savings interest rates have been hiked by 10-70 bps across various instruments. This should help to garner steady deposits in the coming quarter, in light of the expected rate hike from the MPC in April 2023, which would subsequently get transmitted to bank deposit rates,” said ICRA Chief Economist Aditi Nayar while commenting on the revision of interest rates.

(With UNI inputs)

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