7 hrs ago
Small Savings Rates Face September 30 Review Across Three Schemes
The government reviews interest rates on some small savings schemes every three months.
These schemes include PPF, SSY and SCSS.
PPF currently pays 7.1 percent interest.
SSY and SCSS both currently pay 8.2 percent.
PPF has kept the same rate for 25 quarters.
SSY has kept the same rate for 10 quarters.
SCSS has had its current rate since April 2023.
If rates change after the September 30 review, the new rates will also affect money already in these accounts during the next quarter.
The government is scheduled to review PPF, SSY and SCSS interest rates for the October-December quarter on September 30.
PPF currently pays 7.1% and has remained unchanged for 25 consecutive quarters since April 2020.
SSY offers 8.2%, a rate unchanged for 10 consecutive quarters after its last increase in January 2024.
SCSS pays 8.2%, although its benchmark formula indicates an approximate rate of 7.5%.
Any revised quarterly rate would apply to existing balances from the October-December quarter, rather than being permanently locked at account opening.
- Who
- The government and investors in the Public Provident Fund, Sukanya Samriddhi Yojana and Senior Citizen Savings Scheme.
- What
- Quarterly interest rates for the three small savings schemes are due for review.
- Where
- The schemes are administered through India’s small savings system; no specific location is stated.
- When
- The review notification is scheduled for September 30, covering the October-December quarter.
- Why
- The government reviews the rates against prescribed government-security yield benchmarks, while retaining discretion over whether to follow the formulas mechanically.
Key facts
- PPF rate
- 7.1%, unchanged for 25 consecutive quarters
- SSY rate
- 8.2%, unchanged for 10 consecutive quarters
- SCSS rate
- 8.2%, unchanged since April 2023
- PPF benchmark
- 10-year government security yield plus a 25-basis-point spread
- SSY benchmark
- Long-term government securities plus a 75-basis-point spread
- SCSS formula-implied rate
- Approximately 7.5%, based on a 6.5% five-year government-security yield and a 100-basis-point spread
- Rate application
- The declared quarterly rate applies to outstanding balances, including existing accounts
Sources
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