The Centre on Thursday withdrew its notification, ordering cut in interest rates for PPF and other small savings schemes.
This was confirmed by Union Finance Minister Nirmala Sitharaman.
“Interest rates of small savings schemes of GoI shall continue to be at the rates which existed in the last quarter of 2020-2021, i.e, rates that prevailed as of March 2021. Orders issued by oversight shall be withdrawn,” Nirmala Sitharaman said.
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Orders issued by oversight shall be withdrawn. @FinMinIndia @PIB_India
— Nirmala Sitharaman (@nsitharaman) April 1, 2021
The cuts in schemes ranging from the National Savings Certificates or NSC and Public Provident Fund or PPF, would have hurt millions of middle class depositors.
The rollback was announced as Assam and West Bengal voted in the second phase of Assembly elections.
The Centre on Wednesday issued a notification reducing interest rates on public provident fund (PPF) and other small saving schemes for first quarter of financial year 2021 with effect from April 1 (Thursday).
As per the notification issued on Wednesday, the interest rates of PPF would have been reduced from 7.1% to 6.4% while the interest rate on NSC would have been reduced to 5.9% from 6.8%.
The new interest rate on PPF would have been the lowest since 1974.
If implemented, this would have been the second cut in interest rates on small savings within a year.
In the April-June quarter of 2020-21, the Centre had slashed rates of small savings schemes by 0.70-1.4 per cent.