From the year 2012-13,
the interest rates on various Small Savings Schemes (SSS) are recalculated and
notified in the month of March every year. These rates are applicable for the
next financial year. This is being done in line with the recommendations of
the Shyamala Gopinath Committee to ensure that the interest rates of Small
Savings Schemes are market linked.
Accordingly, as done in
the previous years, the interest rates for various Small Savings Schemes were
due for recalculation in March 2016. As notified on 16th February,
2016, instead of annual resetting of interest rates for the next financial
year, the interest rates from now on will be reset every quarter based on the
G-Sec yields of the previous three months. Consequently, the interest rates for
various Small Savings Schemes were recalculated with reference to the G-Sec
yields of equivalent maturity for the months December 2015 to February 2016.
Based on this calculation, the interest rates on various Small Savings Schemes
for the 1st quarter of 2016-17 have been notified today. The rates
of interest on various small savings schemes for the First Quarter of Financial
Year 2016-17, on the basis of the interest compounding/payment built-in in the
schemes, shall be as under:
|
Instrument
|
Rate of interest w.e.f. 01.04.2015 to
31.3.2016
|
Rate of interest w.e.f. 01.04.2016 to
30.6.2016
|
|
Savings Deposit
|
4.0
|
4.0
|
|
1 Year Time Deposit
|
8.4
|
7.1
|
|
2 Year Time Deposit
|
8.4
|
7.2
|
|
3 Year Time Deposit
|
8.4
|
7.4
|
|
5 Year Time Deposit
|
8.5
|
7.9
|
|
5 Year Recurring Deposit
|
8.4
|
7.4
|
|
5 Year Senior Citizens Savings Scheme
|
9.3
|
8.6
|
|
5 year Monthly Income Account Scheme
|
8.4
|
7.8
|
|
5 Year National Savings Certificate
|
8.5
|
8.1
|
|
Public Provident Fund Scheme
|
8.7
|
8.1
|
|
Kisan Vikas Patra
|
8.7
|
7.8 (will mature in 110 months)
|
|
Sukanya Samriddhi Account Scheme
|
9.2
|
8.6
|
This is a formula
driven process.
Further, as notified
earlier, the additional interest rate spreads which the Government allows on
Small Savings Schemes like PPF, Senior Citizen Savings Scheme, Sukanya Samridhi
Scheme, NSC etc. are being continued. The additional spread for these Schemes
are 25 basis points for PPF, 100 basis points for Senior Citizen Savings
Scheme, 75 basis points for Sukanya Samridhi Scheme, 25 basis points for five
year time deposit, 25 basis points for National Savings Certificate and 25
basis points for Monthly Income Scheme. These additional interest rate spreads
are being continued and are included in the rates notified today.
The quarterly revision
of interest rates will ensure that the interest rates under Small Savings
Schemes are more dynamically related to the current market rates, thereby
enabling the Banks to move their interest rates in line with current money
market rates.
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DSM