Government Keeps Small Savings Rates Unchanged for Q1 FY 2025-26
For those who rely on small savings schemes for secure returns, the government has decided to maintain the current interest rates for the April-June 2025 quarter. The Ministry of Finance confirmed this decision through a circular issued on March 28, 2025. This move ensures continued stability for investors in schemes like the Public Provident Fund (PPF), Senior Citizen Savings Scheme (SCSS), Sukanya Samriddhi Yojana (SSY), and the National Savings Certificate (NSC), among others.
No Change in Interest Rates for Key Savings Schemes
As per the official announcement, the interest rates for various post office savings schemes will remain the same as in the previous quarter (January-March 2025). Here’s a look at the unchanged rates:
| Savings Scheme | Interest Rate |
|---|---|
| Post Office Savings Account | 4% |
| Post Office Recurring Deposit | 6.7% |
| Post Office Monthly Income Scheme | 7.4% |
| 1-Year Time Deposit | 6.9% |
| 2-Year Time Deposit | 7.0% |
| 3-Year Time Deposit | 7.1% |
| 5-Year Time Deposit | 7.5% |
| Kisan Vikas Patra (KVP) | 7.5% |
| Public Provident Fund (PPF) | 7.1% |
| Sukanya Samriddhi Yojana (SSY) | 8.2% |
| National Savings Certificate (NSC) | 7.7% |
| Senior Citizens’ Saving Scheme (SCSS) | 8.2% |
These rates remain attractive, making small savings schemes a reliable investment choice for individuals seeking secure and tax-beneficial returns.
Why Are Small Savings Interest Rates Reviewed?
The government revises these rates every quarter based on the recommendations of the Shyamala Gopinath Committee. The committee suggests that these rates should be slightly above the yield of government bonds with similar maturity periods, ensuring that these schemes remain competitive against market fluctuations.
Last Interest Rate Revision
The last adjustment to small savings interest rates was made in the final quarter of FY 2023-24 when the government increased rates for three-year time deposits and the Sukanya Samriddhi Yojana. Since then, no changes have been made. By keeping rates steady, the government aims to provide stability and encourage long-term savings among investors.
A Reliable Investment in Uncertain Times
Small savings schemes continue to play a crucial role in India’s financial landscape. They provide a sense of security, especially for senior citizens and long-term investors, offering guaranteed returns in a fluctuating economy. With tax benefits and steady interest rates, these schemes remain a preferred option for conservative investors looking for risk-free growth.
For more financial insights, visit MoneyPhobia. To check the official government circular, visit RBI’s website.