Small Saving Schemes Will Government Hike PPF Sukanya Samriddhi Scheme Interest Rate In April 2023

Small Saving Schemes Interest Rates: Many schemes like PPF, Sukanya Samriddhi Yojana and National Savings Certificate are run under the small savings schemes of the Central Government. The interest of these schemes is fixed on a quarterly basis. During January to March, interest was increased for some of these schemes by the Central Government.

The new quarterly session for these schemes is starting from the new financial year 2023-24 or April 2023. In such a situation, there is a big question whether the government will increase the interest of schemes like Public Provident Fund, Sukanya Samriddhi Yojana, Senior Citizen Saving Scheme and National Savings Certificate?

How is interest calculated under small savings scheme?

The interest rate of small savings schemes in the secondary market is linked to the market yield of the government security. The small savings scheme interest formula is fixed on the basis of the performance of the last three months. The government decides on the performance base of the last three months whether the interest of these schemes will increase or not? This is based on the recommendations of the Shyamala Gopinath Committee 2011.

Will the interest rate of these schemes increase?

As per the formula notified in FY16, there could be an increase of 25 bps in PPF, 75 basis points in Sukanya Samriddhi Yojana and 100 basis points in Senior Citizen Savings Scheme. The benchmark 10-year bond yield from December to February 2022 has averaged 7.37 per cent.

How much will be the interest rate

According to ET’s report, the PPF will increase by 25 basis points based on the 10-year G-Sec yield. Although there is 7.1 percent interest now, on the basis of which its interest can be 7.6 percent. On the other hand, the interest of Sukanya Samriddhi Yojana can be increased from 7.6 percent interest rate to 8.1 percent soon.

There was an increase in the interest rate of some schemes

For the March quarter, the government had increased the interest rate of some schemes. An increase from 20 bps to 110 bps was made by the government. Although the interest of PPF and Sukanya Samriddhi Yojana was not increased.

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