The National Savings Certificate (NSC), which currently yields a 6.8% interest rate, will now yield a 7% interest rate under the altered rates. In contrast, the senior citizen savings programme will offer 8% interest, up from the current 7.6%.Public provident funds (PPF) interest rates, on the other hand, have remained unchanged and will continue to yield 7.1%.Additionally, there will be an increase in interest rates of up to 1.1 percentage points for Post Office term deposit plans with terms of 1 to 5 years.The interest rate for one-year term deposits is now 6.6%, while rates for two- and three-year deposits are 6.8% and 6.9%, respectively.5 year term deposits, however, have not changed and will continue to earn 5.8% interest.
Source : News9live The government reviews interest rates on small savings plans once every three months.The central bank has lifted its benchmark policy rate by 225 basis points since April in an effort to curb inflation, which has resulted in substantial rate hikes in the economy’s interest rates. Banks have done the same, increasing the rates they charge their clients for both loans and deposits.The reserve bank of india (rbi) highlighted that the revised small savings rates were 44 to 77 basis points lower than the formula predicted rates in its most recent monetary policy report, which was published on september 30.The yield on five-year government bonds grew by about 15 basis points in september-november, the reference period for modest savings interest rates for january-march, while the yield on ten-year bonds increased by 10 basis points in the same time frame.The government has been urged by the central bank to continue using the formula-based method of determining interest rates for modest savings.What do you think? Is this policy good for economy or not? Comment.
