The Central government today revoked the interest rate cut on small savings scheme announced on Wednesday evening. Union Finance Minister Nirmala Sitharaman in a tweet posted at 7.54 am on Thursday, announced that interest rates of small savings schemes of Government of India must go on with the ongoing rates which existed in the last quarter of Financial Year of 2020-2021, i.e the rates applicable on March 2021. The tweet by the Union Minister stated “Orders issued by oversight shall be withdrawn.”
“Interest rates of small savings schemes of GoI shall continue to be at the rates which existed in the last quarter of 2020-2021, ie, rates that prevailed as of March 2021. Orders issued by oversight shall be withdrawn,” said Sitharaman in a tweet shared on early morning.
On Wednesday, the Interest rate on Public Provident Fund (PPF) was slashed by 0.7 percent to 6.4 percent while National Savings Certificate (NSC) was to earn 0.9 per cent less at 5.9 per cent.
The highest cut of 1.1 per cent was announced for the one-year term deposit. The new rate was brought down to 4.4 percent as compared to 5.5 percent.
Further, the Interest rates for small savings schemes were notified on a quarterly basis.
Once restored, PPF and NSC will be carrying an annual interest rate of 7.1 percent and 6.8 percent, respectively.
The girl child savings scheme Sukanya Samriddhi Yojana account will fetch7.6 percent as compared to reduced rate of 6.9 percent.
Accordingly, the interest rate for the five-year senior citizens savings scheme would also be retained at 7.4 percent. The interest on the senior citizens” scheme is granted quarterly.
Interest rate on savings deposits will come back at 4 percent annually from the slashed rate of 3.5 percent.
Term deposits of one to five years will get interest rate in the range of 5.5-6.7 percent. It is to be paid quarterly, while the interest rate on five-year recurring deposits will fetch a higher interest of 5.8 percent as against the reduced 5.3 percent.