I invest monthly in PPF account since July 2012 and in a 5 year Post Office RD since October 2014. What will be the rate of interest of my investments? Whether the Interest would calculate at the rate when I joined these or with the revised rate of 2016?
- Ajith N
Yes, the interest rates for Public Provident Fund (PPF) will be revised every quarter with effect from April 2016, and this is to be in line with yields of government securities. The rate of interest for the first quarter of this financial year (April -June 2016) is 8.10 percent per annum. This means that your PPF account balance as on 31 March 2016 and your investments for the current quarter will earn you 2.70 percent (8.10 percent divided by 3).
For post office Recurring Deposits, the interest is locked for the tenure, which means your RD account will earn the prevailing interest rate of October 2014 . The quarterly change in RD rates will not affect your existing account.
This article was originally published on May 18, 2016.
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