A small financial savings fee reset was keenly awaited as returns on these schemes had been hiked considerably forward of the final Lok Sabha election in January 2019. File
| Photo Credit: PTI
The Union authorities on December 29 determined to lift the returns on the Sukanya Samriddhi Account Scheme (SSAS) from 8% to eight.2%, and on 3-year time deposits from 7% to 7.1%, for the primary quarter of 2024, whereas retaining the established order on curiosity rates for all different small financial savings schemes.
A small financial savings fee reset was keenly awaited as returns on these schemes had been hiked considerably forward of the final Lok Sabha election in January 2019. However, there was no main rejig this time round and returns on the favored Public Provident Fund (PPF), which had been hiked to 7.9% forward of the earlier basic election, stay frozen for one more quarter at 7.1%.
PPF fee frozen
While this marks the sixth successive quarter of hikes in choose small financial savings schemes, the PPF fee has been unchanged since April 2020. The return on the SSAS was additionally held at 7.6% from April 2020, however was hiked to eight% in April this yr. The returns on the PPF and the SSAS are tax-free.
According to the Reserve Bank of India (RBI), the PPF return ought to have been pegged at 7.51% for the October to December 2023 quarter, as per the formula-based rates regime for small financial savings schemes adopted in 2016.
The RBI, in its financial coverage report for October, had additionally famous that returns on 5-year recurring deposit (RD) accounts ought to have been hiked to six.91% for this quarter. However, these rates have additionally been left unchanged at 6.7% for the upcoming January to March 2024 interval.
Small financial savings schemes’ rates for the subsequent quarter, as per the adopted system, are linked to the federal government bond yields prevailing between September and November 2023 for securities of matching maturities.
