Money & Banking

Interest rate on small-saving plans slashed by up to 140 bps for 3 months

Our Bureau New Delhi | Updated on April 01, 2020 Published on March 31, 2020

The government on Tuesday slashed the interest rate on small savings by up to 140 basis points (100 basis points mean 1 percentage point) for three months period starting April 1. The new rates will be applicable on fresh deposit in these schemes from Wednesday.

These schemes include National Saving Schemes (NSS), Public Provident Fund (PPF) and Kisan Vikas Patra (KVP), beside post office savings schemes. These schemes are very popular among the salaried class as these instruments are used for tax savings and the returns are much higher than bank fixed deposit.

In an office memorandum, the Department of Economic Affairs said that on the basis of the Centre’s decisions, the rates of interest on various small savings schemes for the first quarter of financial year have been revised. Accordingly, five-year NSC will fetch 6.8 per cent as against 7.9 per cent earlier. Similarly, rate of interest on PPF has been lowered to 7.1 per cent from 7.8 per cent.

On the recommendations of the Shyamala Gopinath panel, starting April 1, 2016, interest rates on 12 small savings schemes are reviewed at the end of every quarter and new rates announced for the next quarter. This revision tales place on the basis of yield of government securities.

 

 

Published on March 31, 2020

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.