What will the government’s decision be? Rates on small savings plans like PPF, Sukanya Samriddhi will go up or you will be disappointed

New Delhi. Many small savings schemes are operated by the central government. Such as PPF, Sukanya Samriddhi Yojana and National Savings Certificate. Interest rates for these programs are determined quarterly. From January to March, the government had increased interest in some of these programs. However, at that time there was no change in the interest rates of the Public Provident Fund (PPF) and the Sukanya Samriddhi Yojana Girls Savings Scheme. Please inform that the interest rate of these programs has not increased since January 2019. According to media reports, a government official has pointed out that there is no way to generate high returns on these programs.

This is because the government no longer fully agrees with the Shyamala Gopinath Committee formula adopted in April 2016. Despite the rate hikes on some other small savings plans for the third and fourth quarters of 2022-23, the returns on these two plans remained stable. A senior Treasury official told The Hindu that at the moment we do not agree with the formula of the Shyamala Gopinath Committee.

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what is the recommendation
For the March quarter, the government had increased the interest rate of some programs. An increase from 20 bps to 110 bps was made by the government. Although the interest of PPF and Sukanya Samriddhi Yojana did not increase. The PPF rate for the December quarter should have been raised to 7.72% and the yield on the Sukanya Samriddhi account to 8.22%, according to the formula developed by the panel headed by the former Deputy Governor of the Reserve Bank of India ( RBI), Shyamal Gopinath.

Interest rates are reviewed quarterly
The Small Savings Scheme interest rates are reviewed quarterly. The formula for setting the interest rates of these programs was set by the 2016 Shyamala Gopinath Committee. The committee suggested that interest rates on these programs should be 0.25-1.00% higher than government bond yields of a similar maturity. Currently, interest rates on government bonds are close to 7.5%. Despite this, the interest rates on the small savings plan were not increased.

Find out how much interest is being received in which program
You get 7.60% on investing in Sukanya Samriddhi Yojana.
7.1% on the public provident fund, ie PPF.
7% on National Savings Certificate (NSC)
7.2% interest is granted on the investment in Kisan Vikas Patra.
At the same time, 8% interest is paid on senior citizens’ savings.

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Keyword: ppf, PPF account, Small savings plans, Small savings plans, Sukanya Samriddhi scheme