Yesterday, the Ministry of Finance announced latest and revised interest rates for post office saving schemes applicable for the period July-2017 to September-2017 (2nd Quarter of FY18). For the past 5 quarters, Ministry of Finance is reducing interest rates gradually. In current quarter to July-17 to September-17, Ministry has finance has reduced the interest rates of small Saving Schemes by 0.1%. What are the latest post office interest rates for July-2017 to September-2017? Which are the post office small saving schemes offer highest interest rates compared to bank FD’s or other saving schemes?
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Post Office Small Saving Schemes Interest rates for July to Sep-2017
Here is the quick snapshot about the latest interest rates announced now.
1) Reduction of 0.1% or 10 basis points (bps) on all post office small saving schemes except for savings bank account rate.
2) Among the post office saving schemes, highest interest rates is being offered on Sukanya Samriddhi Account Scheme and Senior Citizens Saving Scheme at 8.3% per annum.
3) With compounding of interest rates by a quarter, term deposits and recurring deposits offer high interest rates per annum.
4) Post office term deposit offers 6.8% to 7.6% per annum from 1 to 5 years tenure. After compounding, the term deposits gives yield of 6.9% to 7.8% per annum. Currently many banks are offering around 5% to 7% per annum only. Hence Post office Term deposits are best, compared to bank fixed deposit schemes.
5) Investment in Kissan Vikas Patra (KVP) is doubled after 115 months as per latest interest rates (compared to 113 months earlier). If you want to double your money, you need to deposit for at least 120 months or higher in the bank. KVP is still beneficial compared to bank FD schemes.
6) The Post Office MIS Scheme offers 7.5% per annum interest rates, which is payable every month. If you are a retired person, investing in post office monthly income scheme (POMIS) is one of the best way to get safe monthly income.
7) If you want to save money for your girl child and get higher returns, you can invest your money in Sukanya Samriddhi Account Scheme which offers 8.3% interest rates. The maturity amount is tax free.
8) If you want to invest your money for child education or for daughter marriage, you can consider investing in Public Provident Fund (PPF) which offers 7.8% interest. While the tenure is for 15 years, it offers highest tax free returns along with tax benefits u/s 80C.
9) If you are planning to save money every month, you can consider post office recurring deposit which offers up to 7.1% annualized yield. You can invest Rs 1,000 per month in post office RD scheme for 5 years. Your investment amount would be Rs 60,000 (1,000 x 60 months) and the maturity amount would be Rs 72,300. You can invest minimum of Rs 10 and in multiples of Rs 10 there-off.
10) If you are a low risk taker and planning to invest money to save tax, NSC is one of the best option to invest.
You can refer the Ministry of India, Small Saving Schemes, Govt. of India notification about the latest interest rate changes which are effective from 1st July to September, 2017 here.
Here are the Latest Post office Interest Rates for July-2017 to September-2017
Conclusion: Post office small saving schemes offer the highest returns compared other saving schemes and bank FD schemes. Some of the popular schemes like PPF and Sukanya Samriddhi Yojana Scheme offers highest interest rates. If you are a low risk taker, consider investing in small saving schemes offered by the post office.
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Suresh
Post Office Small Saving Schemes Interest rates for July to Sep-2017
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Thank you GK
I want to gift a rs. 1500 for 5 years old children for long term I.e 25 years. Please suggest and also name of scheme and return, please reply
FOR SENIOR CITIZEN, WHICH SCHEME WILL BE BETTER, MIS or SCSS ?
TAX WILL BE DEDUCTED AT SOURCE IN BOTH SCHEMES.?
IS THERE ANY CHANGE IN POST OFFICE INTEREST RATES FOR OCT.-DEC QTR. COMPARED TO JULY-SEPT 2017?
No changes Sushil
I want to know today current FD rates in post office for one year.