The Government has hiked the interest rates for various small saving schemes by upto 40bps for the third quarter. The table below shows the change in returns for various small saving schemes:
| Instrument | Rate of interest w.r.t 30.09.2018 (%) | Rate of interest w.r.t 01.102.08 (%) |
| Savings Deposit | 4.00 | 4.00 |
| 1 Year Time Deposit | 6.60 | 6.90 |
| 2 Year Time Deposit | 6.70 | 7.00 |
| 3 Year Time Deposit | 6.90 | 7.20 |
| 5 Year Time Deposit | 7.40 | 7.80 |
| 5 Year Recurring Deposit | 6.90 | 7.30 |
| 5 Year Senior Citizen Savings Scheme | 8.30 | 8.70 |
| 5 Year Monthly Income Account | 7.30 | 7.70 |
| 5 Year National Savings Certificate | 7.60 | 8.00 |
| Public Provident Fund | 7.60 | 8.00 |
| Kisan Vikas Patra | 7.30 (Maturity 118 Months) | 7.70 (Maturity 112 Months) |
| Sukanya Samriddhi Account | 8.10 | 8.50 |
Source: Economic Times, September 21, 2018
These schemes are a good alternative to some riskier corporate debt investments. However, it is still advisable for investors with longer term investment horizon to invest in equity related products and mutual funds as they tend to outperform fixed income products in the long term.
