‘Piggy banks’ sit on display. (Photographer: Billy H.C. Kwok/Bloomberg)

Government Hikes Interest Rates On Small Savings Schemes After Nine Months 

The government has increased interest rates on small savings scheme by up to 40 basis points for the October-December quarter, according to an official notification.

The Department of Economic Affairs notifies interest rates on small savings schemes on a quarterly basis and the last revision was made for the January-March quarter of this year. Rates have remained unchanged since then.

Interest rate on Public Provident Fund, Kisan Vikas Patra Scheme and the Sukanya Samriddhi Account Scheme have been hiked by 40 basis points.

Interest rate on one year, two year, and three year time deposit have also been increased by 30 basis points to 6.9 percent, 7 percent and 7.2 percent, respectively.

Investments in five year time deposits, Senior Citizen Savings Scheme and National Savings Certificates will also earn higher interest, with rates being revised upwards by 40 basis points.

Interest rates for all small saving schemes have been linked to government bond yields since April 2016, and are fixed on a quarterly basis.