Skip to main content

Small savings rates cut by 0.1%

By

The government on Friday lowered interest rates on smallsavings schemes such as the public provident fund, oneto fiveyear time deposits, fiveyear recurring deposits, the senior citizens scheme Kisan Vikas Patra and the Sukanya Samriddhi scheme for the AprilJune quarter,amove that could lead to banks cutting their deposit rates as well.
Of the 12 small savings schemes, the Centre cut the rates by 0.1 percentage point over those in the JanuaryMarch quarter for 11 of them, leaving out the savings deposit, which was maintained at 4 per cent. Since April last year, the interest rates for all small savings schemes have been recalibrated onaquarterly basis.
“To bring such rates somewhat closer to market rates, the government has decided to effectareduction of 0.1 percentage point (10 basis points) in interest rates across the board in all the schemes, except the Post Office Savings Account, which has been left untouched,” the finance ministry said inastatement. “Small savings schemes will continue to be attractive as some of them enjoy income tax benefits and additional interest rate spreads,” it said.Anotification said that investments in the public provident fund (PPF) scheme would fetchalower annual rate of 7.9 per cent, the same as the fiveyear National Savings Certificate.
The existing rate for these two schemes is 8 per cent.
Kisan Vikas Patra (KVP) investments will yield 7.6 per cent and mature in 112 months.
The one for girl child savings, the Sukanya Samriddhi Account Scheme, will offer 8.4 per cent annually, from 8.5 per cent at present, while it will be the same at 8.4 per cent for the fiveyear Senior Citizens Savings Scheme, on which interest is paid quarterly.
Term deposits of onefive years will earnalower 6.97.7 per cent, which will be paid quarterly, while the fiveyear recurring deposit has been pegged lower at 7.2 per cent.
The rates of small savings schemes have been linked to government bond yields since the quarterly revision began.
A notification said that investments in the PPF scheme would fetchalower annual rate of 7.9%
Business Standard New Delhi,01th April 2017

Comments

Post a Comment

Popular posts from this blog

RBI deputy governor cautions fintech platform lenders on privacy concerns during loan recovery

By
  India's digital lending infrastructure has made the loan sanctioning system online. Yet, loan recovery still needs a “feet on the street” approach, Swaminathan J, deputy governor of the Reserve Bank of India, said at a media event on Tuesday, September 2, according to news agency ANI.According to the ANI report, the deputy governor flagged that fintech operators in the digital lending segment are giving out loans to customers with poor credit profiles and later using aggressive recovery tactics.“While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending small-value loans to customers often with poor credit profiles,” Swaminathan J said.   Fintech platforms' business models The central bank deputy governor highlighted that many fintech platforms' business models involve providing sm
Post a Comment
Read more

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the rep
Post a Comment
Read more

India can't rely on wealthy to drive growth: Ex-RBI Dy Guv Viral Acharya

By
  India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve, Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said on Monday.Acharya, who is the C V Starr Professor of Economics in the Department of Finance at New York University’s Stern School of Business (NYU-Stern), said after the Covid-19 pandemic, rural consumption and investments have weakened.We can’t be pumping our growth through the rich and expect that the economy as a whole will do better,” he said while speaking at an event organised by Elara Capital here.f there has to be a trickle-down, it should have actually happened by now,” Acharya said, adding that when the rich keep getting wealthier and wealthier, they have a savings problem.   “The bank account keeps getting bigger, hence they look for financial assets to invest in. India is closed, so our money can't go outside India that easily. So, it has to chase the limited financial assets in the country and
Post a Comment
Read more