After announcing a steep cut in the interest rates on small savings schemes, the next day the government announced a rollback. So, the interest rates on small savings schemes, including public provident fund (PPF) remain unchanged for the April-June quarter. Finance Minister Nirmala Sitharaman on Thursday said the government has withdrawn Wednesday’s order which announced a steep interest rate cut on small saving schemes such as PPF and NSC – saying it was an oversight. “Interest rates of small savings schemes of GoI shall continue to be at the rates which existed in the last quarter of 2020-2021, ie, rates that prevailed as of March 2021. Orders issued by oversight shall be withdrawn,” read a tweet from Finance Minister Nirmala Sitharaman.
Ever wondered how much time it would take for your PPF money to double. If you want to know how long it takes for your investment to double, you should know the rule of 72.
Rule of 72
We will use the ‘Rule of 72’ to see how fast will the invested money in the public provident fund be doubled. Rule of 72 is a formula where we divide the number ’72’ with the interest rate offered by the investment instrument to get an idea of how soon can you double your money with that particular investment. Let’s take a look:
After the latest revision by the govt, PPF is offering an interest rate of 7.1% p.a. Assuming you get an interest rate of 7.1% throughout if you divide 72 by 7.1% you will get 10.14 years. So, at the current rate of interest, your money will double in 10.14 years. So, PPF will take around 10 years to double your money assuming the interest rate remains the same. It may take less or more time depending upon the rate of interest offered by it.
Small savings scheme interest rate
National Savings Certificate (NSC) will give 6.8 per cent. One-year term deposit scheme to earn a higher interest rate of 5.5 per cent during the first quarter of the current fiscal while the girl child savings scheme Sukanya Samriddhi Yojana and the Senior Citizen Savings Scheme will earn 7.6 per cent. For Kisan Kisan Vikas Patra, depositors will get 6.6 per cent. For the five-year recurring deposit, the interest will be 5.8 per cent. Govt notifies interest rates for small savings schemes quarterly.