The interest rate on PPF will be 6.4 percent instead of 7.1 percent per annum, while for the Senior Citizen Savings Scheme, the interest rate has been fixed at 6.5 percent instead of 7.4 percent per annum. The 5-year Monthly Income Account Scheme will offer 5.7 percent instead of 6.6 percent payable monthly. On the 1-year time deposit, the interest rate stands at 4.4 percent, while on the 5-year warranty, the rate will remain at 5.8 percent per annum.
The mostis on the 1-year deposit, where the new rate is now lower by 1.1 percent. The interest rate on the post office has also been cut from 4 percent to 3.5 percent. The 5-year RD scheme will get 5.3 percent, while Sukanya Samriddhi Yojana will offer 6.9 percent per annum. The ( 6.2 percent) instead of the earlier tenure of 124 months (6.9 percent)
Based on government yields, the government sets the interest rates onschemes for the next three months at the start of every quarter of the financial year. If there is a change, it does not impact all the schemes; for the in NSC, KVP, Time Deposits, and Senior Citizens Savings Scheme (SCSS), the interest rate remains fixed until maturity. However, investors of PPF and Sukanya Samriddhi Yojana (SSY) see a revision in the rate when the government revises the speed at each quarter of any financial year.
Several post office schemes are the first choice of investors looking for fixed and assured income. All of them are sovereign-backedthe government guarantees the principal invested and the interest earned. Some also come with tax benefits under Section 80C of the I-T Act.
Before investing, make sure about the tax liability of the interest you will earn on PO schemes, as some may have a taxable interest. Likewise, as most of them have a long duration, ensure you have liquidfor the long haul. Put funds into them by connecting to your long-term requirements and keeping across equity and debt into consideration. Significantly, the schemes carry a sovereign assurance on the sum contributed, taking the highest safety on the entire principal invested.