Sukanya Samriddhi Yojana Rate Hike: In the April-June quarter, the government also increased the interest rates of Sukanya Samriddhi Yojana but did not increase the interest rate on PPF.
Investors investing in Public Provident Fund ie PPF can get a big deal. There is a possibility that the interest rates of PPF can be increased for the second quarter of the financial year 2023-24 from July to September. The Finance Ministry is about to review the interest rates of small savings schemes. Which can be announced today.
There has been no increase in the interest rates of PPF since April 2020 till now. PPF is currently getting 7.1 percent interest annually. However, during this period, the central government has increased the interest rates of almost all small savings schemes for the last three quarters, including Sukanya Samriddhi Yojana.
For April to June, the interest rate of these savings schemes was increased by 10 to 70 basis points. In which the interest rate of NSC i.e. National Saving Certificate was increased from 7 percent to 7.70 percent. The interest rate of Sukanya Samriddhi Yojana was increased from 7.6 per cent to 8 per cent. At present, 7.5 percent interest is being received annually on Kisan Vikas Patra and its maturity period was reduced from 120 months to 115 months.
The interest rates of these savings schemes have been increased but the government has not increased the interest rates of PPF. While RBI has increased the repo rate by 2.50 in a year. After which the banks have increased the interest rates on FDs, then the government has increased its small savings schemes. In such a situation, the investors of PPF are also expecting the interest rates to be increased.
There is a formula for fixing the interest rates of PPF which was notified by the Finance Ministry in 2016. Under this, 25 basis points more interest is given on PPF than the 10-year bond yield. Currently the bond yield is 7.3 per cent. Based on this formula, the interest rates of PPF should be increased to 7.55 per cent.
Urban and rural common Indians invest in savings schemes like PPF as safe. These are the people who rely on investing in these schemes while staying away from the ups and downs of the stock market and also invest to save tax. To maintain the popularity of PPF, there is pressure on the government to increase the interest rates.
