Friday, November 11, 2011

Interest Rates increased on Small Savings Instruments

Under decision on the recommendations of the committee for comprehensive review of National Small Savings Fund (NSSF) dated 11th November, 2011, interest rates on small savings instruments have been changed.   This change has been done after a gap of long time.  Some highlights of the decision is given as under :-
  1. Interest on Post Office Saving Account (POSA) will be increased from 3.50% to 4.00% p.a. 
  2. Bonus @ 5% on Monthly Income Scheme (MIS) will be discontinued
  3. Interest on savings schemes will be aligned with G-Sec rates of similar maturity with a spread of 25 basis points (BPS) with two exceptions.  The spread on 10 year NSC (new instrument) will be 50 bps and on senior citizens Saving Scheme 100 bps.   The interest rates for every financial year will be notified before 1st April of that year. 
  4. Assuming the date of implementation of the recommendations of the committee as 1st December, 2011.
COMPARATIVE INTEREST RATES OF SMALL SAVING SCHEMES
Serial No.
Instruments
Current  Rate (%)
Proposed Rate (%)
1
Saving Deposit
3.50
4.00
2
1 Year Time Deposit
6.25
7.70
3
2 Year Time Deposit
6.50
7.80
4
3 Year Time Deposit
7.25
8.00
5
5 Year Time Deposit
7.50
8.30
6
5 Year Recurring Deposit
7.50
8.00
7
5 Year SCSS
9.00
9.00
8
5 Year MIS
8.00 (6 Year MIS)
8.20
9
5 Year NSC
8.00 (6 Year NSC)
8.40
10
10 Year NSC
New Instrument
8.70
11
PPF
8.00
8.60

Download the Detailed Press Release for More Clarity.  (Online View)

Intense Debate Comments