Regarding reduction of interest rate of Small Savings Schemes
Government of India
Ministry of Finance
Department of Economic Affairs
1.Shri S C Maheswari,
Secretary General BPS,
Jangpura-‘A’, New Delhi — 110 014.
North Block, New Delhi
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Sub: Regarding reduction of interest rate of Small Savings Schemes.
I am directed to refer to above cited subject. High small savings interest rates limit the banking sector’s ability to lower deposit rates in response to the monetary policy of the Reserve Bank of India. In this context by quarterly re-fixing the Small Savings interest rates the transmission of the lower interest rates in the economy has been eased. This will help India transition to a lower interest rate economy. While doing so, the Government has taken a comprehensive view on the social goals of certain National Small Savings Schemes. The issue raised by you is a policy related issue and the same has been noted.
(Anil Kumar Jha)
Under Secretary to the Govt. of India
Tele. — 01123093035.