PPF & SSY Update: If you invest in PPF and Sukanya Samriddhi Yojana (SSY) for the future of your family and children, this news is for you. The Reserve Bank of India (RBI) cut the repo rate for the first time in five years on Friday. Following this, the government may reduce the interest rate on small savings schemes like PPF and Sukanya Samriddhi in the next financial year. The government reviews the interest rates for small savings schemes every quarter.
The next review for the April-June quarter will be on March 31. The RBI’s decision may affect the interest rates of these savings schemes. However, the Finance Ministry may not reduce the rates immediately, as the impact of the new rates will be seen in the coming months. Also, banks usually collect more deposits in the last quarter of the financial year. A government source said, “This is a good time to invest in savings schemes.”
Small Savings Scheme Interest May Drop
Experts believe the Finance Ministry can reduce interest rates on small savings schemes next year. However, schemes like PPF will still be a good option because they offer tax benefits and compound interest. The central government plans to collect Rs 3.4 lakh crore from small savings schemes in the next financial year. This year’s target was Rs 4.1 lakh crore.
Sukanya Samriddhi Yojana (SSY) is a really good investment if you have a baby girl.
₹ Interest Rate 8.2%
₹ Interest not taxable.
₹ 80C deduction allowed.This is for those who wants fixed income instruments instead of Mutual Fund .#MutualFund #SSY #Investing
— CA Paaras Gangwal (@ThetaVegaCap) February 7, 2025
Current Interest Rates on PPF & Sukanya Samriddhi
The government also plans to withdraw Rs 20,000 crore under the Mahila Samman Yojana, as the scheme is ending in March. Right now, PPF offers 7.1% annual interest, while Sukanya Samriddhi Yojana gives 8.2%. The government may reduce these rates soon, so it is better to invest now. These schemes also give tax benefits under Section 80C of the Income Tax Act.