Post office schemes are quite popular among small and middle class people including the farming community. These savings schemes offer stable dividends and there are no risk factors associated with it.
Popular post office savings schemes
Savings accounts, recurring deposits, time deposits, national savings monthly accounts, senior citizens savings schemes, public provident fund (PPF), sukanya samriddhi, national savings certificates, and kisan vikas patra are all popular post office savings schemes.
Interest Rate on Post Office Schemes
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The interest rate on the post office savings account is 4%, with an annual compounding frequency.
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A one-year time deposit offers 5.5 percent interest rate with a quarterly compounding frequency.
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A two-year time deposit offers 5.5 percent interest rate and a quarterly compounding frequency.
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A three-year time deposit offers 5.5 percent interest rate with a quarterly compounding frequency.
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A five-year time deposit has an interest rate of 6.7% and a quarterly compounding frequency.
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A five-year recurring deposit scheme offers 5.8 percent interest rate with a quarterly compounding frequency.
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The senior citizen savings scheme offers 7.4 percent interest rate with a quarterly compounding frequency.
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The monthly income scheme offers an interest rate of 6.6 per cent.
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The national savings certificate offers 6.8 percent interest rate with an annual compounding frequency.
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The public provident fund scheme offers 7.1 per cent interest rate with compounding frequency of annually.
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Kisan vikas patra offers an interest rate of 6.9 per cent with a compounding frequency of annually.
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The Sukanya samriddhi scheme offers an interest rate of 7.6 per cent with a compounding frequency of annually.
Post office scheme important update
The government has decided to keep the interest rates unchanged on small savings schemes or post office schemes for the January-March quarter of FY 2021-22. The Ministry of Finance made this announcement via a circular dated December 31, 2021.
For the quarter ending March 31, 2022, investors in small savings schemes like the Public Provident Fund (PPF) and Sukanya Samriddhi Yojana (SSY) will continue to earn the same interest rate as they were earning during the quarter ending December 31, 2021. New investments made during the January-March 2022 quarter into these schemes will also earn the same interest rates as in the previous quarter.
According to the circular, the Public Provident Fund (PPF) would continue to earn 7.10 percent in the fourth quarter of fiscal year 2021-22. Senior Citizens Savings Scheme (SCSS) will continue to earn 7.40%, while post office time deposits will earn 5.5-6.70%. The interest rates will be in effect from January 1, 2021 to March 31, 2022.
