The Department of Economic Affairs, Finance Ministry, has announced that there will be no changes in the interest rates for small savings schemes for the January-March 2025 quarter. This means that the interest rates for these schemes will remain the same as those notified for the October-December 2024 quarter. This article provides latest post office small saving scheme interest rates applicable for Jan-2025 to Mar-2025 quarter.
Notification on Latest Post Office Interest Rates Jan-Mar-2025
According to the press release dated December 31, 2024:
“The rate of interest on various Small Savings Schemes for the fourth quarter of FY 2024-25 starting from 1st January, 2025 and ending on 31st March, 2025 shall remain unchanged from those notified for the third quarter (1st October, 2024 to 31st December, 2024) of FY 2024-25.”
Current Interest Rates for Small Savings Schemes
Here are the interest rates applicable for various small savings schemes during the January-March 2025 quarter:
| Scheme | Interest Rate |
|---|---|
| Savings Deposit | 4.0% |
| 1 Year Time Deposit | 6.9% |
| 2 year Time Deposit | 7.0% |
| 3 year Time Deposit | 7.1% |
| 5 year Time Deposit | 7.5% |
| 5 Year Recurring Deposit | 6.7% |
| Senior Citizen Savings Scheme | 8.2% |
| Monthly Income Account Scheme | 7.4% |
| National Savings Certificate | 7.7% |
| Public Provident Fund Scheme | 7.1% |
| Kisan Vikas Patra | 7.5% |
| Sukanya Samriddhi Account | 8.2% |
How Government Sets Small Savings Schemes Interest Rates
Small savings schemes are backed by the central government, that provides sovereign guarantees. The interest rates for these schemes are reviewed and set every quarter by the government.
When did the last change happened in these interest rates?
The last revision in the interest rates for small savings schemes occurred in the January-March 2024 quarter. During that revision, the interest rates for the 3-year post office time deposit and Sukanya Samriddhi Yojana were increased. Since April 2024, there have been no further changes in the rates.
Will Interest Rates Be Reduced in coming quarters?
Economists predict that the Reserve Bank of India (RBI) is likely to reduce the repo rate and other policy rates in 2025. Central banks worldwide have already started reducing interest rates, raising questions about whether the Indian government will follow suit and reduce small savings scheme rates in upcoming quarters.
Summary of Popular Post Office Small Saving Schemes
#1 – 5-Year Post Office Recurring Deposit Account (RD)
- Interest Rate: 6.7% per annum (quarterly compounded).
- Minimum Deposit: INR 100 per month (in multiples of INR 10). No maximum limit.
- Suitable For: Small and regular savers, risk-averse investors, and long-term planners.
#2 – Post Office Time Deposit Account (TD)
- Interest Rates: Vary based on tenure (1 to 5 years).
- Minimum Deposit: INR 1,000 (in multiples of INR 100). No maximum limit.
- Suitable For: Fixed-income investors, tax-saving options, and flexible tenures.
#3 – Post Office Monthly Income Scheme Account (MIS)
- Interest Rate: 7.4% per annum, payable monthly.
- Minimum Deposit: INR 1,000 (in multiples of INR 1,000).
- Suitable For: Retirees, pensioners, and moderate savers.
#4 – Senior Citizen Savings Scheme (SCSS)
- Interest Rate: 8.2% per annum, paid quarterly.
- Minimum Deposit: INR 1,000 in multiples of INR 1,000.
- Suitable For: Senior citizens and retirees seeking secure, regular income.
#5 – 15-Year Public Provident Fund (PPF) Account
- Interest Rate: 7.1% per annum (compounded yearly, tax-free).
- Minimum Deposit: INR 500 per financial year.
- Suitable For: Long-term investors and tax-saving individuals.
#6 – Sukanya Samriddhi Account (SSA)
- Interest Rate: 8.2% per annum, compounded yearly (tax-free).
- Minimum Deposit: INR 250 annually.
- Suitable For: Parents/guardians saving for girl children.
#7 – National Savings Certificates (NSC)
- Interest Rate: 7.7% annually (compounded but payable on maturity).
- Minimum Deposit: INR 1,000 (in multiples of INR 100).
- Suitable For: Conservative investors and tax-saving individuals.
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