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Latest post office small savings schemes interest rates Oct-Dec 2024: The Ministry of Finance announced on Monday that it has kept the interest rates on small savings schemes such as Public Provident Fund, Sukanya Samriddhi Yojana, National Savings Certificate, Kisan Vikas Patra, term deposits etc. unchanged for the third quarter of the ongoing financial year from October 2024 to December 2024.
“The rates of interest on various Small Savings Schemes for the third quarter of FY 2024-25 starting from 1st October, 2024 and ending on 31st December, 2024 shall remain unchanged from those notified for the second quarter (1st July, 2024 to 30th September, 2024) of FY 2024-25,” the Ministry of Finance statement read.
The interest rates for various small savings schemes, excluding the Public Provident Fund (PPF), have seen a substantial rise in recent years. Currently, the Senior Citizen Savings Scheme (SCSS) and Sukanya Samriddhi Account (SSA) offer a lucrative interest rate of 8.2%. However, as we approach the end of the increasing interest rate cycle, the rates may begin to decline in the near future.
Post Office Small Savings Schemes: Latest Interest Rates October-December 2024
In recent years, the interest rates of various small savings schemes, except for PPF, have seen a significant increase. The interest rates of these schemes, including the Senior Citizen Savings Scheme and Sukanya Samriddhi Account, are determined by the yields of 10-year Government Securities in the secondary market.
The Ministry of Finance has established formulae for mark-ups over the average yield of relevant G-Secs of comparable maturities during the three months preceding each quarter, according to an ET report. The interest rates are reviewed quarterly based on the average G-Sec yield of the previous three months.
The interest rates of most small savings schemes are currently aligned with the formula recommended by the Shyamala Gopinath Committee in 2011. Consequently, a rate hike for these schemes is unlikely for the December quarter.
For investors, the recommended strategy is to continue focusing on small savings schemes to obtain stable and predictable returns.
Nirav R Karkera, Head-Research at Fisdom, advises, “Diversifying across different tenures and schemes (such as the Senior Citizen Savings Scheme or National Savings Certificate) can help balance risks if there are future rate cuts. It would be wise for investors to lock in current rates, as future reductions in interest rates cannot be ruled out once inflation pressures ease further and the monetary policy becomes more accommodative.”
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