For the eighth consecutive quarter, the government has chosen not to alter interest rates on small savings schemes such as PPF and NSC, with the latest decision effective from 1 April.
"The rates of interest on various small savings schemes for the first quarter of FY 2026-27, starting from April 1, 2026, and ending on June 30, 2026, shall remain unchanged from those notified for the fourth quarter (January 1, 2026 to March 31, 2026) of FY 2025-26," the Finance Ministry said in a notification on March 31.
According to the notification, deposits made under the Sukanya Samriddhi Scheme will continue to earn 8.2% interest, while the rate for three-year term deposits has been retained at 7.1%. Rates for the Public Provident Fund (PPF) and post office savings deposits have been left untouched at 7.1% and 4%, respectively.
The Kisan Vikas Patra will offer 7.5% interest, with investments set to mature in 115 months. Returns on the National Savings Certificate (NSC) will remain at 7.7% for the April–June quarter, while the monthly income scheme will deliver 7.4% during the first quarter of FY27, unchanged from the previous period.
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Small Savings Interest Rates (Q1FY27)
Even as rising inflation and trends in the 10-year government securities yield pointed towards a potential rate change, the government has maintained the status quo on small savings schemes. Interest rates were last revised in December 2024, with hikes announced for Sukanya Samriddhi Account (SSA) and three-year post office term deposits.
These schemes benefit from a sovereign guarantee, making them among the safest investment options. The funds collected are fully invested in state government securities, with the Centre extending them as long-term loans to aid development initiatives.
The government uses a benchmark linked to government bond yields of corresponding maturity to set rates. It also factors in inflation, Reserve Bank of India (RBI) policy signals and liquidity conditions. Even so, protecting the interests of small savers often leads to a preference for stability over frequent revisions.
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