Post office small savings schemes: Interest on TD account is compounded on a quarterly basisFrom January 1, investment in a time deposit account in a post office fetches 7 per cent return in a lock-in period of 1-3 years.
In other words, time deposits - or term deposits - of a maturity period of one year, two years and three years pay a 7 per cent interest in post office.
For quarter ending March 31, money in one-year, two-year and three-year TD accounts will fetch interest at rate of 7 per cent, according to India Post's website - indiapost.gov.in.
( Government announces small savings scheme interest rates for March quarter)1.
A time deposit or TD account can be opened in four options of maturity period: one-year, two-year, three-year and five-year.
Interest on TD account is compounded on a quarterly basis.2.
Of these, one-year and two-year time deposit accounts fetched interest at rates of 6.9 per cent and 7.2 per cent in October-December quarter respectively.
A TD account of five-year maturity continues to yield interest at 7.8 per cent, according to post office website.3.
The government revises interest rates applicable to small savings schemes on a quarterly basis.
The finance ministry had last year increased interest rates applicable to small savings schemes by up to 0.4 per cent for October-December quarter.4.
For quarter ending March 31, government has only changed interest rates applicable to one-year and three-year time deposits, while keeping those on other small savings schemes unchanged.5.
The government offers nine types of small savings schemes, such as Time Deposit, Savings Account, Recurring Deposit, Senior Citizen Savings Scheme (SCSS), Public Provident Fund and National Savings Certificate (NSC).