Central government withdraws decision to reduce interest rates on small savings. The central government has withdrawn the decision to cut the interest rate on small savings schemes. Finance Minister Nirmala Sitharaman has given this information by tweeting. Late night there was news that the interest rate on small savings schemes has been reduced for the first quarter of the financial year 2021-22. But now this decision has been withdrawn. The Finance Minister has said that this order had gone out by mistake.
In her tweet, the Finance Minister said, “The interest rates of the small savings schemes of the Government of India will remain the same, which were present in the last quarter of 2020-2021 i.e. the rates will remain in force till March 2021.”
Central government withdraws decision ; Small savings schemes including PPF cut interest rates by 1.1%.
On Wednesday, the government had cut interest rates by 1.1 per cent on small savings schemes, including the Public Provident Fund (PPF) and NSC (National Savings Certificate). The deduction was announced for the first quarter of 2021-22 starting April 1. According to the Finance Ministry notification, the interest on PPF was reduced by 0.7 per cent to 6.4 per cent, while on NSC, it was reduced by 0.9 per cent to 5.9 per cent.
The interest rate on the five-year Senior Citizen Savings Scheme was reduced by 0.9 per cent to 6.5 per cent. Under this scheme interest is paid on quarterly basis. For the first time, interest on the amount deposited in the savings account was reduced by 0.5 per cent to 3.5 per cent.
The maximum reduction of 1.1 percent in interest was made on one-year term deposits. Similarly, interest on term deposits for two years was reduced by 0.5 per cent to 5 per cent, interest on term deposits for a period of three years was reduced by 0.4 per cent, while interest on term deposits for five years was reduced by 0.9 per cent to 5.8 per cent.
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