Ministry of Finance has announced latest post office interest rates applicable for Jan-23 to Mar-23 period. We could see that they have increased interest rates for few small saving schemes schemes. Senior Citizens Saving Scheme now offers 8% interest rate which is the highest among the small saving schemes. In this article, we would provide revised and latest post office interest rates of small saving schemes applicable for Jan-23 to Mar-23 i.e. 4th Quarter of FY 2022-23.
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Post Office Interest Rates – Jan-23 to Mar-23 – Summary of Changes
Readers note that many websites are still showing old rates indicating these are applicable for Jan-23 to Mar-23. You can check MoF official website or below table for accurate interest rate info.
There are 12 small saving schemes offered by the post office. Some of these small saving schemes can be purchased through major commercial banks in India too.
New Post Office interest rates for Jan-23 to Mar-23 indicate that the Ministry of Finance has revised the interest rates for 8 post office small saving schemes.
Post Office Interest Rate Table – Jan-23 to Mar-23
Here is the existing interest rates vs. revised rates (applicable for Jan-23 to Mar-23).
| Scheme | Current Rates | Revised Rate | Frequency of Compounding | Tenure |
|---|---|---|---|---|
| Savings Account | 4.0% | 4.0% | Yearly | NA |
| Fixed Deposit – 1 year | 5.5% | 6.6% | Quarterly | 1 year |
| Fixed Deposit – 2 years | 5.7% | 6.8% | Quarterly | 2 years |
| Fixed Deposit – 3 years | 5.8% | 6.9% | Quarterly | 3 Years |
| Fixed Deposit – 5 years | 6.7% | 7.0% | Quarterly | 5 Years |
| Recurring Deposit-5 Years | 5.8% | 5.8% | Quarterly | 5 years |
| 5 Year Senior Citizen Savings Scheme | 7.6% | 8.0% | Quarterly and paid | 5 Years |
| Monthly Income Account (Earlier MIS) | 6.7% | 7.1% | Monthly and paid | 5 Years |
| NSC – 5 years | 6.8% | 7.0% | Yearly | 5 Years |
| PPF | 7.1% | 7.1% | Yearly | 15 Years |
| KVP | 7.0% | 7.2% | Yearly | 10 Yrs (120 months) |
| Sukanya Samriddhi Account Scheme | 7.6% | 7.6% | Yearly | 21 Years |
Features of Post Office Small Saving Schemes
Here are the key features of post office small saving schemes.
1) Post Office FD
Post office offers term deposits (FDs) for the tenure of 1 year, 2 years, 3 years and 5 year period.
Post Office interest rates on FD for 1 to 5 years tenure is in the range of 6.6% to 7%.
These FD rates are compounded every quarter.
5 year FD is eligible for income tax deduction u/s 80c up to Rs 1.5 Lakhs.
2) Post office Recurring Deposit (PO RD)
Post office RD is offered for 5 years tenure.
Current Post office RD rate is 5.8% per annum
This RD interest rate is compounded every quarter.
Post office RD interest rate is very low compared to major commercial bank FDs.
3) National Savings Certificate (NSC)
NSC is issued for 5 years tenure.
The NSC interest rate is 7%, compounded annually and paid on maturity.
While there is no maximum limit, investment in NSC up to Rs 1.5 Lakhs in a financial year qualifies for income tax deduction u/s 80c.
4) Kisan Vikas Patra (KVP)
Kisan Vikas Patra (KVP) would double your money in the post office.
Latest KVP interest rate is 7.2%, which is compounded annually and paid on maturity.
KVP has a tenure of 120 months. Means, your money would get doubled in 120 months.
5) Post Office MIS
Post office Monthly Income Scheme (PO MIS) provides monthly income.
POMIS has 5 years tenure.
Latest Post office MIS rate is 7.1%.
One can invest a minimum of Rs 1,000 in this scheme
Maximum amount of investment is Rs 4.5 lakhs for a single account. In case of joint account, one can invest up to Rs 9 Lakhs.
6) Sukanya Samriddhi Account (SSA)
SSA can be opened for girl child by a parent or by a guardian.
Latest Sukanya Samriddhi rate is 7.6%.
Interest is compounded annually and paid on maturity.
One can invest a minimum of Rs 250 and maximum of Rs 1.5 Lakhs in a financial year.
Amount invested in SSA is eligible for income tax deduction u/s 80c up to Rs 1.5 Lakhs.
7) Senior Citizens Saving Scheme (SCSS)
Individuals who are above 60 years can open SCSS.
Senior Citizens Saving Scheme (SCSS) interest rate is 8%
This interest is paid every quarter.
Such interest rate would be reviewed and reset every quarter.
Minimum investment in SCSS is Rs 1,000 and the maximum amount is Rs 15 Lakhs.
SCSS has a tenure 5 years.
SCSS scheme can be extended for a further 3 year period within 1 year of the maturity.
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8) Public Provident Fund (PPF)
PPF is one of the best investment to accumulate money in the long term.
PPF has a lock-in period of 15 years.
PPF interest rate is 7.1%
This interest is compounded annually and paid on maturity.
Minimum investment in PPF is Rs 500 and maximum is Rs 1.5 Lakhs in a financial year.
Investment in PPF would quality for income tax deduction u/s 80c to Rs 1.5 Lakhs.
One can open PPF in Post Office or any large commercial banks.
If you are not happy with the post office or any bank where you have PPF, you can transfer them to another bank.
Interest received in PPF is tax free.
On maturity of 15 years, PPF can be extended for a block of 5 years for any number of times.
Source: Ministry of Finance notification
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Apart from PPF which is an EEE scheme and has immense benefits, the second best is of course SCSS with 8% interest (paid quarterly).
Thank you for the details.