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The central government has kept interest rates unchanged on small savings schemes like post office deposits, public provident fund (PPF), Sukanya Samriddhi Yojana (SSY) and National Savings Certificate (NSC) for the January-March 2025 quarter.
Small Savings Schemes are savings instruments managed by the government to encourage citizens to save regularly.
As the interest rates on small savings schemes like post office deposits, public provident fund (PPF), Sukanya Samriddhi Yojana (SSY) and National Savings Certificate (NSC) are revised every quarter, investors keep an eye out on the rate changes. This time, the central government has kept interest rates on such schemes unchanged for the January-March 2025 quarter.
“The rates of interest on various small savings schemes for the fourth quarter of FY 2024-25, starting from January 1, 2025, and ending on March 31, 2025, shall remain unchanged from those notified for the third quarter (October 1, 2024, to December 31, 2024) of FY 2024-25,” according to a finance ministry notification.
Current Interest Rates On Small Savings Schemes?
The interest rates for the current quarter January-March 2025 are as follows:
- Savings Deposit: 4 per cent
- 1-Year Post Office Time Deposits: 6.9 per cent
- 2-Year Post Office Time Deposits: 7.0 per cent
- 3-Year Post Office Time Deposits: 7.1 per cent
- 5-Year Post Office Time Deposits: 7.5 per cent
- 5-Year Recurring Deposits: 6.7 per cent
- National Savings Certificate (NSC): 7.7 per cent
- Kisan Vikas Patra: 7.5 per cent (will mature in 115 months)
- Public Provident Fund: 7.1 per cent
- Sukanya Samriddhi Account: 8.2 per cent
- Senior Citizens Savings Scheme: 8.2 per cent
- Monthly Income Account: 7.4 per cent.
Bank Fixed Deposits Vs Post Office Deposits: Interest Rates Comparison
Post offices are offering FD interest rates between 6.9 per cent and 7.1 per cent, while banks are providing interest rates in the range of 6.5 per cent to 8.05 per cent. The rates are for deposits for tenures between 1 year and 3 years for citizens below 60 years of age. Senior citizens are offered extra interest rates of fixed deposits.
Bandhan Bank offers the highest FD interest rates at 8.05 per cent for 1-3 tenures of deposits, according to bankbazaar.com.
Though interest rates on small savings schemes have been left unchanged for the last four quarters now, the RBI MPC is expected to cut interest rates in February or April monetary policy review.
The government notifies the interest rates on small savings schemes, majorly operated by post offices and banks, every quarter.
The government had last made changes in some schemes for the fourth quarter of the last fiscal.
What Are Small Savings Schemes?
Small Savings Schemes are savings instruments managed by the government to encourage citizens to save regularly. The small savings schemes have three categories — savings deposits, social security schemes and monthly income plan.
Saving deposits include 1-3-year time deposits and 5-year recurring deposits. These also include saving certificates such as National Saving Certificates (NSC) and Kisan Vikas Patra (KVP). Social security schemes include Public Provident Fund (PPF), Sukanya Samriddhi Account and Senior Citizens Savings Scheme. The monthly income plan includes the Monthly Income Account.
Interest rates on small savings schemes like PPF, post office savings and term deposits, NSC and SSY, are reviewed at the end of every quarter and are decided for the next quarter accordingly. The rate review is done on the basis of G-Sec yields of the preceding quarter (October-December 2024 in the latest case).
