Interest rates applicable to small savings schemes - such as the retirement planning-focused 15-year Public Provident Fund (PPF), the tax-saving fixed deposit and Senior Citizen Savings Scheme (SCSS) - are reviewed every quarter. For the first quarter of financial year 2019-20, which begins on Monday, April 1, the government has left the small savings schemes' interest rates unchanged at existing levels. This means that for the April-June quarter, investment in small savings schemes with continue to fetch interest at the rates to the tune of 4-8.7 per cent, according to India Post's website - indiapost.gov.in.
India Post, which operates a network of more than 1.5 lakh post offices across the country, offers nine small savings schemes under its portfolio. From savings to fixed deposit and recurring deposit, the post office today offers several types of investment options to the retail customer.
Here's a comparison of the interest rate and investment limits applicable to these small savings schemes (including Public Provident Fund) for the quarter beginning April 1, 2019:
| Small savings scheme | Interest rate | Minimum amount required for opening account | Maximum investment allowed |
|---|---|---|---|
| Savings account | 4% | Rs 20 | |
| Five-year recurring deposit account | 7.30% | Rs 10 per month | No limit |
| One-year time deposit (fixed deposit) account | 7% | Rs 200 | No limit |
| Two-year time deposit (fixed deposit) account | 7% | Rs 200 | No limit |
| Three-year time deposit (fixed deposit) account | 7% | Rs 200 | No limit |
| Five-year time deposit (fixed deposit) account | 7.80% | Rs 200 | |
| Monthly income scheme | 7.30% | Rs 1,500 | Rs 4.5 lakh |
| Senior citizen savings scheme (SCSS) | 8.70% | Rs 1,000 | Rs 15 lakh |
| 15-year public provident fund | 8% | Rs 500 | Rs 1.5 lakh per financial year |
| National savings certificate (NSC) | 8% | Rs 100 | No limit |
| Kisan Vikas Patra (KVP) | 7.70% | Rs 1,000 | No limit |
| Sukanya Samriddhi | 8.50% | Rs 1,000 | Rs 1.5 lakh per financial year |
| (Source: indiapost.gov.in) | |||
Out of these small savings schemes, investment in the five-year term deposit (fixed deposit), Senior Citizen Savings Scheme (SCSS), 15 year Public Provident Fund and National Savings Certificates (NSC) qualifies for income tax benefit under Section 80C of the Income Tax Act.
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