Hike Interest Rates on PPF, SCSS: RBI to Banks

The Reserve Bank of India (RBI) has directed banks to increase interest rates on Public Provident Fund (PPF) and Senior Citizen Small Savings Scheme (SCSS) from April 1. The Central Bank states that the interest rates on PPF and SCSS will be 8.8% and 9.3% respectively from April 1. The new rates would be applicable during this financial year.

Last month, government decided to hike the interest rates on PPF by 0.2% to 8.8%. The interest rates for SCSS have been increased from 9% to 9.3%. RBI asked banks to display these new interest rates on PPF and SCSS on their notice boards for the information to new subscribers.

The idea of raising the interest rates is based on the recommendations of the Shyamala Gopinath Committee which had suggested the linking of small savings interest rates with that of the market. It had also suggested that the interest rates on small savings should be revised annually.