The Government of India has increased interest rates on various post office-operated small savings schemes like Monthly Income Scheme (MIS), Public Provident Fund (PPF), National Savings Scheme (NSC), One Year, Two Years and Three Years term deposits along with Senior Citizens Savings Scheme (SCSS). The interest rates are hiked up to 0.5 per cent. The modified interest rates will come into effect from 1st April 2012. There is no change in savings deposits. The interest rate on these deposits is 4 percent per annum.
The interest rates were increased considering the recommendations of Shyamala Gopinath Committee. The increased rates may attract the investors who like to save the money in small amounts with fixed income to go for the Post Office Schemes. As per the new rates, Interest rates on time deposits of one and two years will be up by 0.5 per cent each to 8.2 per cent and 8.3 per cent respectively. The interest rates on much popular MIS has been hiked by 0.3 per cent making it 8.5 per cent. Following are the latest interest rates of Post Office Savings Schemes as on 27th March 2012:
1) One Year Term Deposits: 8.2
2) Two Years Deposits: 8.3
3) Monthly Income Scheme (MIS): 8.5
4) Public Provident Fund (PPF): 8.8
5) National Savings Scheme (NSC) – 5 Years: 8.6
6) National Savings Scheme (NSC) – 10 years: 8.9
7) Three Year Deposits: 8.4
8) Five Year Deposits: 8.5
9) Five Years Recurring Deposits (RD): 8.4
10) Senior Citizens Savings Scheme (SCSS): 9.3
Shyamala Gopinath Committee has suggested the increase of interest rates to suit that of the market. The panel had also recommended that the interest rates on small savings schemes of post offices should be revised annually. Hence present interest rates are valid for the year 2012-13. The revision will help the small investors to get the maximum out of fixed deposit schemes. Other attractive investments these days are Infrastructure Bonds being issued by various PSU and Private Sector companies. These are allowed up to Rs. 20000 for those like to avail tax benefits.