Small Savings Schemes: The Finance Ministry has announced its decision after reviewing small savings schemes. The interest rates received on Public Provident Fund (PPF), National Savings Certificate (NSC) and others have been kept as it is. These rates will be applicable for the October-December 2025 quarter.
This is particularly important because the government has not yet reduced the rates of schemes like Sukanya Samriddhi Account (SSA) and Senior Citizens Savings Scheme (SCSS), while this year the repo rate has been cut three times this year. The repo rate is the rate at which banks borrow from the Reserve Bank of India (RBI).
How much RBI cut this year
This year, RBI has made three major cuts in the repo rate. The repo rate was 6.5% at the beginning of the year. 25–25 basis points were cut in February and April, and in June 50 basis points were reduced. Overall, there has been a cut of 1% this year.
Also, yields of government bonds (G-SEC) have also decreased, which are the basis for fixing the interest rates of small savings schemes. The 10-year G-SEC yield was 6.78% on 1 January 2025, to 6.45% by 24 September 2025.
According to the formula of the Shyamala Gopinath Committee, the PPF rates are fixed by adding 25 basis points with a 10-year G-SEC yield. It should have been an average of 6.66% at the last quarter, while the current PPF rate is 7.1%.
When was the last change in interest rates
The final change was made in January-March 2024. At that time, the time deposit rate of 3 years was increased from 7% to 7.1% and the rate of Sukanya Samriddhi Yojana (SSA) was increased from 8% to 8.2%. The rates of other schemes remained the same.
This means for investors
Crores of Indian investment depend on these small savings schemes for stable returns. These include senior citizens, pensioners and middle class families, especially. If the interest rates were reduced in such a situation, then their income would have been affected. The government decides the rate according to the formula of the Gopinath Committee, but also takes care of market status and safety of investors.