Current Affairs 1st April 2021: The government has withdrawn its order to cut interest rates on PPF, NSC, and other small savings schemes.

1st April, 2021 Published by: Saloni Bhatia Updated Thu, 01 Apr 2021 11:35 AM IST

According to FM Sitharaman, interest rates on the Government of India small savings schemes will remain unchanged from the last quarter of 2020-2021.

Source: Amar ujala


The interest rates on the Government of India's small savings schemes will remain unchanged from the last quarter of 2020-2021. For the April-June quarter, the PPF will continue to pay 7.1 percent interest. For the current year, the National Savings Certificate (NSC) would receive 6.8% interest.

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The Government take a reverse back with its order

 
The government reversed interest rate cuts announced last night on small savings schemes such as the common Public Provident Fund (PPF) and National Savings Certificate (NSC).
"Interest rates of small savings schemes of the government of India shall continue to be at the rates that prevailed as of March 2021 in the last quarter of 2020-2021," the Finance Ministry tweeted this morning. She went on to state, "Orders given by oversight shall be revoked."
 

All About the scheme earlier?

 
The government cut interest rates on small savings schemes last evening (March 31), the last day of the previous fiscal year. The rates of small savings schemes have been reduced by 50-100 basis points, according to a circular released by the Finance Ministry.

PPF interest rates were reduced to 6.4 percent from 7.1 percent, while rates on Senior Citizen Savings Schemes, Monthly Income Accounts, National Savings Certificates, and Kisan Vikas Patra were reduced to 6.5 percent, 5.7 percent, 5.9 percent, and 6.2 percent, respectively, under the order. These rates were expected to take effect immediately. The proposed prices would have been the lowest in the country since 1974.

It's worth noting that interest rates on small savings accounts are updated every quarter. After three-quarters of the status quo, the above interest rate cuts were declared. Previously, in the first quarter of the fiscal year 2021-22, interest rates on small savings schemes were cut by a significant amount.

The latest order from the finance ministry, on the other hand, is a welcome relief for savers and senior citizens who depend on the interest income from these schemes to supplement their income. As two states, Bengal and Assam voted in the second round of state elections, the rollback was declared.

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