Interest Rates for Small Savings Schemes for April to June 2020

The Government of India has cut the interest rates on Small Savings Schemes by 70-140 bps from April 2020 to June 2020. This means the investors will earn less on their savings in these schemes from 1st April to 30th June 2020.

The post office investments like Public Provident Fund (PPF), National Savings Certificate (NSC), Senior Citizen Savings Scheme (SCSS), Kisan Vikas Patra (KVS), Sukanya Samridhi Scheme, RD Account, PO Term Deposit, etc. are very popular investment options among Indians.

What are the latest interest rates for small savings schemes for April to June 2020? Which is the highest interest rate on post office savings schemes? In this post, let us take a look at the interest rates for Small Savings Schemes for April to June 2020.

Interest Rates Schedule for Post Office Small Savings Schemes

Earlier the rate of interest on post office savings schemes used to be announced yearly once. Since 1st April 2016, the Government of India notifies the rate of interest on small savings schemes every quarter.

Following is the quarterly interest rate schedule for post office saving schemes.

S. No.	Rates of Interest would be effective for the quarter	The date on which it will be notified
1	April to June (First Quarter)	15th March
2	July to September (Second Quarter)	15th June
3	October to December (Third Quarter)	15th September
4	January to March (Fourth Quarter)	15th December

The Government of India announced the rate of interest for post office saving schemes for the first quarter of FY 2020-2021 starting from April 1, 2020, and ending on June 30, 2020.

Interest Rates for Small Savings Schemes for the period April to June 2020

This time, the government has slashed the rate of interest for post office saving schemes by 70-140 bps for the first quarter of the financial year 2020-2021. This means that the millions of investors will earn less by investing in these instruments for the first quarter of the financial year 2020-2021.

Rate of Interest for Small Savings Schemes for April to June 2020

1. The Senior Citizens Saving Scheme (SCSS) will fetch 7.4% per annum as against 8.6% earlier.

2. The 5 years National Savings Certificate will earn an interest rate of 6.8% per annum as against 7.9% earlier.

3. The PPF (Public Provident Fund) scheme will also fetch an interest rate of 7.1% per annum after an 80 bps cut in the interest rate.

4. The girl child savings scheme Sukanya Samriddhi Account will fetch the highest interest rate of 7.6% per annum.

5. KVP (Kisan Vikas Patra) will fetch an interest rate of 6.9% and mature in 124 months.

6. The five-year Recurring Deposit Account will fetch an interest rate of 5.8% per annum.

7. The 5 years Monthly Income Account will offer an interest rate of 6.6% per annum.

8. Post Office Time Deposit of 1 to 5 years interest rates will be as:

The interest rate for I year Time Deposit is 5.5%

The interest rate for 2 year Time Deposit is also 5.5%

The interest rate for 3 year Time Deposit is also kept at 5.5%

The interest rate for 5 years Time Deposit is 6.7%

9. The interest rate for the Post Office Savings Account will remain unchanged at 4% p. a.

Interest Rates for Small Savings Schemes for April to June 2020

Scheme Name	The rate of Interest from 01/04/2020 to 30/06/2020	The rate of Interest from 01/01/2020 to 31/03/2020	Frequency of Compounding
Savings Account	4%	4%	Annually
Time Deposit - 1 Year	5.5%	6.9%	Quarterly
Time Deposit - 2 Years	5.5%	6.9%	Quarterly
Time Deposit - 3 Years	5.5%	6.9%	Quarterly
Time Deposit - 5 Years	6.7%	7.7%	Quarterly
5 Year Recurring Deposit (RD)	5.8%	7.2%	Quarterly
Sukanya Samriddhi Account Scheme	7.6%	8.4%	Annually
Kisan Vikas Patra (KVP)	6.9%	7.6%	Annually
PPF Scheme	7.1%	7.9%	Annually
5 Year National Savings Certificate	6.8%	7.9%	Annually
5 Year Post Office Monthly Income Account	6.6%	7.6%	Monthly and paid
5 Year Senior Citizens Savings Scheme	7.4%	8.6%	Quarterly and paid

Click here to read the office memorandum from the Department of Economic Affairs, Ministry of Finance about the “Interest rates for small savings schemes”.

You can view the interest rates for the previous eight quarters:

·      Interest rates for small saving schemes for January to March 2020

·      Interest rates forsmall saving schemes for October to December 2019

·      Interest rates for small saving schemes for July to September 2019

·      Interest rates for small saving schemes for April to June 2019

·      Interest rates for small saving schemes for January to March 2019

This time, the government has cut the rate of interest for small savings schemes by 70-140 bps for the first quarter of the financial year 2020-2021. Therefore, now these post office saving schemes will offer less to the investors on their savings.

Also, read: Top 12 Best Mutual Funds to invest in 2020

Also, read: What is SIP (Systematic Investment Plan)

Also, read: Benefits of SIP | Advantages of SIP

Also, read: How to start a SIP

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