Govt to withdraw cut in rate on small savings schemes: FM

New Delhi: In a relief to savers, Finance Minister Nirmala Sitharaman on Thursday said the government will withdraw orders to cut interest rate on small savings schemes and assured to restore the rates to last quarter of the financial year ending on March 31.

In a jolt to savers, the Finance Ministry on Wednesday had reduced interest rate by up to 1.1 per cent across various small savings schemes, including the National Savings Certificates (NSC) and Public Provident Fund (PPF).

“Interest rates of small savings schemes of GoI shall continue to be at the rates which existed in the last quarter of 2020-2021, ie, rates that prevailed as of March 2021. Orders issued by oversight shall be withdrawn,” Sitharaman said in a early morning tweet.

Interest rate on Public Provident Fund (PPF) was reduced by 0.7 per cent to 6.4 per cent, while National Savings Certificate (NSC) was to earn 0.9 per cent less at 5.9 per cent.

The steepest fall of 1.1 per cent was effected in the one-year term deposit. The new rate was brought down to 4.4 per cent as compared to 5.5 per cent.

Interest rates for small savings schemes are notified on a quarterly basis.