The government on Wednesday slashed interest rates on small savings schemes, including NSC and PPF, by 0.2 percentage point for the January-March period from the rates applicable in the previous quarter, a move that will prompt banks to lower deposit rates. At the same time, investments in the five-year Senior Citizens Savings Scheme has been retained at 8.3 per cent. Since April last year, interest rates on all small savings schemes have been recalibrated on a quarterly basis. While announcing the quarterly setting of interest rates, the ministry had said that rates of small savings schemes would be linked to government bond yields. The move is expected to see banks lowering their deposit rates in line with the small savings rate offered by the government.

Source: Hindustan Times December 27, 2017 15:22 UTC