Investment Tips: Schemes like PPF, and NSC are giving better returns than FD, check here...

The Reserve Bank recently increased the repo rates to control inflation. After the increase in repo rates, many banks have increased the interest rates on fixed deposits. After the increase, the bank FDs are now giving slightly higher returns than before. Even after the increase in interest rates, small savings schemes are still giving attractive returns as compared to FDs.

Interest rate better than banks
Citizens are currently getting up to 7.6 percent interest on small savings schemes including PPF, Senior Citizens Savings Scheme, National Savings Certificate, and Sukanya Samriddhi Account Scheme. On the other hand, if we talk about the interest rate available on FD, then banks like PNB, SBI, and HDFC are providing an interest rate of about 6 percent on it.

What are small savings schemes?
Small savings schemes have been started by the government to encourage people to invest regularly. These schemes include post office savings deposits, fixed deposits of 1-3 years, and recurring deposits of 5 years. These also include saving certificates and investment schemes like National Saving Certificate and Kisan Vikas Patra. These schemes include social security schemes Public Provident Fund, Sukanya Samriddhi Account, and Senior Citizen Savings Scheme. A monthly income account also comes under these schemes.

Interest rate on small savings scheme
The government reviews the interest rates on small savings schemes every quarter. The government had kept interest rates unchanged in the last review on June 30. Post office savings deposits at the post office fetch an interest rate of 4 percent per annum. Fixed deposits of deposit tenure of 1-3 years are currently offered at 5.5 percent per annum. The post office's five-year fixed deposit is giving a return of 6.7 percent per annum. The five-year recurring deposit can earn an interest of 5.8 percent per annum.

The monthly income is 6.6 percent interest
The interest rates are expected to be revised by the end of this month. In the last review at the end of the June 2022 quarter, the government had kept interest rates unchanged. "The rates of interest on various small savings schemes for the second quarter of the financial year 2022-23, starting from July 1, 2022, and ending on September 30, 2022, shall remain unchanged from the rates notified for the first quarter (April 1).

Interest rates on fixed deposits
Many banks have revised their interest rates on deposits as well as loans. On fixed deposits of less than Rs 2 crore, the State Bank of India is offering an interest rate of 2.90 percent to 5.65 percent on FDs. Other banks are also offering interest rates of up to 6 percent on fixed deposits.