The government on Friday (December 30, 2022) has effected hike in interest rates of 8 small saving instruments for the January-March 2023 quarter. The interest rates of schemes like the Senior Citizen Savings Scheme, Monthly Income Savings Scheme, National Savings Certificate, Kisan Vikas Patra, and all post office time deposits have been hiked.
However, rates on Public Provident Fund (PPF) at 7.1% and Sukanya Samriddhi Account scheme at 7.6%, 5-year recurring deposits at 5.80% remain unchanged
The latest chart of interest for small savings instruments for the Q4 (January – March 2023) is as under
| Scheme | Rate of interest from January2023-March 2023 | Rate of interest from October 2022 – December 2022 | Interest compounded |
| Savings account | 4.00% | 4.00% | Annual rest |
| 1-year time deposit | 6.60% | 5.50% | Quarterly rest |
| 2-years time deposit | 6.80% | 5.70% | Quarterly rest |
| 3-years time deposit | 6.90% | 5.80% | Quarterly rest |
| 5-years time deposit | 7.00% | 6.70% | Quarterly rest |
| 5-years Recurring Deposit | 5.80% | 5.80% | Quarterly rest |
| 5yearsr Senior Citizen Saving Scheme | 8.00% | 7.60% | Interest paid quarterly, Quarterly rest |
| 5- years Monthly Income Account Scheme | 7.10% | 6.70% | Interest paid monthly, |
| 5 -years NSC | 7.00% | 6.80 % | Annual rest |
| PPF (Public Provident Fund) | 7.10% | 7.10% | Annual rest |
| KVP (Kisan Vikas Patra) | 7.20 %(matures120 months) | 7.00%(matures123 months) | Annual rest |
| Sukanya Samriddhi Account Scheme | 7.60% | 7.60 | Annual rest |
The government resets the interest rate at the beginning of every quarter since 2016 based on yields of government securities of the corresponding maturity with some spread on the scheme for senior citizens, as advised by the Shyamala Gopinath Committee.
Other important news on Small savings instruments:
During the announcement of interest for the quarter of April -Jun 18, the Ministry withdrew the earlier restrictions for credit of interest in respect of small savings to basic Savings Bank accounts. Now all the interest and maturity proceeds of small savings instruments operated by the Department of Posts may be paid to the depositors through the depositor’s savings account standing at a post office or any commercial bank, by cheque or in cash.
The PPF account rules were modified by the Government for the benefit of account holders. As per the modified PPF account holders can now make deposits in multiples of ₹50 any number of times in a financial year with a maximum of ₹1.5 lacks a year. Earlier, a maximum of 12 deposits was permitted in a period of 1 year. Read: New rules of PPF
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