Fixed Income
Understanding the World of Bonds
Stock markets and mutual funds keep our universe closed to bonds. It is as if we are happy with liquid funds at 6% or 7%pa (per annum), or we are chasing stocks that can add zeroes to our wealth. Between these two extremes, there is also a world where we can invest money for fixed periods and fixed returns. I am sure that those of you who have been readers of Moneylife for long are aware of...
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Interest on small savings schemes cut by 0.1%
The government on Friday lowered the interest rate on small savings schemes, including Public Provident Fund (PPF), by 0.1 per cent for April 1-June 30 period.
 
Accordingly, interest rates for small savings schemes are to be notified on quarterly basis.
 
"The government has announced revised rates of interest on various small savings schemes for the first quarter of the financial year 2017-18.
 
"To bring such rates somewhat closer to market rates, the government has decided to effect a reduction of 0.1 percentage point (10 basis points) in interest rates across the board in all the schemes except the Post Office Savings Account, which has been left untouched," the Finance Ministry said here in a statement.
 
For the April-June quarter, the interest rate on PPF has been reduced to 7.9 per cent from the earlier 8 per cent. 
 
"The current revision of rates is reflective of the government's commitment to calibrated reform in the financial sector to ensure better interest rate transmission," the statement said.
 
Interest rate on Kisan Vikas Patra has been reduced to 7.6 per cent (which will mature in 113 months) from the earlier 7.7 per cent (with maturity in 112 months). 
 
The Sukanya Samriddhi Account Yojana interest rate has been reduced to 8.4 per cent from the earlier 8.5 per cent. 
 
The interest rates on five-year Recurring Deposit, Senior Citizens Savings Scheme, Monthly Income Scheme and National Savings Certificate have also been reduced by 0.1 per cent each. 
 
"Certainly, senior citizens and pensioners, who depend heavily on interest income, will be the affected lot," chartered accountant Pritam Mahure told IANS.
 
Only the interest on savings deposits has been retained at 4 per cent. 
 
Interest on one-year, two-year, three-year and five-year time deposit has also been lowered by 0.1 per cent each.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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COMMENTS

Asha Bansal

5 months ago

Hi, great article on investments. Was looking for some investment options that could help me secure for bad times.

SRINIVAS SHENOY

7 months ago

The government should be in a position to check inflation to justify its stand of reducing the interest rate on the saving instruments.

SCSS Scores over Tax-saver Bank FD
Senior Citizen’s Savings Scheme (SCSS) is a good fixed income product that offers tax-saving as well. An SCSS account can be opened by an individual who has reached 60 years of age on the date of opening of the account. It can also be opened by a person of age 55 years or above (but less than 60 years) within one month of receipt of retirement benefits from voluntary retirement...
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