Marginal cut in Small Savings interest rates

In a panel discussion on Monday, at the annual national interest reset discussion, the new interest rates for small national savings schemes have been announced.

As per the recommendation of panel members, the interest rates on small saving schemes have been reduced by 10 basis points or .1% compared to previous years.

The RBI annual interest reset panel was headed by RBI deputy governor Shaymala Gopinath. The new interest rates will be effective form April 1, 2013.

The new interest rate values are –

1) Public Provident Fund (PPF) – interest rate lowered from 8.8% to 8.7%

2) National Savings Certificate (NSC) – interest rates lowered from 8.9% to 8.8%; both on twenty and five year maturity schemes

3) Senior Citizen Saving Schemes - interest rate lowered from 9.3% to 9.2%

There will be no change in interest rates on one year deposit schemes. As per the statements of Planning Commission deputy chairman Montek Singh Ahluwalia, the new rates will be more favorable to depositors in this inflation season.