The interest paid on the General Provident Fund and other similar funds will be kept unchanged at 7.1% in the quarter ended March 31, according to the Department of Economic Affairs, Ministry of Finance.
The General Provident Fund, not to be confused with the Public Provident Fund and the Employee Provident Fund, is a social security scheme available only to employees of the central government. Every three months, the government determines the rate for this programme and others like it.
The other schemes include the Contributory Provident Fund, All India Services Provident Fund, State Railway Provident Fund, and the General Provident Fund (Defence Services).
The government announced the rates for small savings schemes in the fourth quarter of the fiscal year by the end of December. Most schemes saw an increase in the rate, but the interest rate on the Public Provident Fund and the Sukanya Samriddhi Account Scheme were kept unchanged at 7.1% and 7.6%, respectively.
Interest rates being offered on deposits have risen over the past few months, in line with the rising policy rates of the Reserve Bank of India. Since May 2022, the central bank has raised the policy repo rate five times, by a total of 225 basis points, to fight elevated inflation.
Most banks raised deposit rates substantially in December to pass on this increase. India's largest bank, the State Bank of India, raised the rates on its one-to-three-year deposits by 50 to 75 basis points with effect from Dec. 13 to 6.75%.
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