If you want to secure your savings while earning good returns, small savings schemes may be the best option. These government schemes, available through post offices and banks, are not only safe but also offer guaranteed returns and, in many cases, tax benefits.
Small Saving Schemes: If you want to grow your hard-earned money safely and are looking for better returns than bank fixed deposits (FDs), the government’s small savings schemes are the right option for you. These schemes are available through post offices and banks and offer investors safe, fixed returns, as well as tax benefits in many cases. The interest rates on these schemes range from 7% to 8.2% in 2025, which is more attractive than most bank FDs. Let’s explore the top 5 best small savings schemes.
1. Public Provident Fund (PPF)
PPF has been a favorite option among investors for decades. It offers an annual interest rate of 7.1% and has a lock-in period of 15 years, which can be extended in blocks of 5 years. You can start with just ₹500 annually and invest up to a maximum of ₹1.5 lakh. Investments, interest, and maturity proceeds in PPF are tax-free.
2. Sukanya Samriddhi Yojana (SSA)
The Sukanya Samriddhi Yojana offers the highest interest rate of 8.2%. This scheme can be opened by parents for daughters under the age of 10. Annual investments range from ₹250 to ₹1.5 lakh. The investment, interest, and maturity amount are all tax-free.
3. National Savings Certificate (NSC)
NSC offers 7.7% interest for a 5-year term. This scheme starts with a minimum investment of ₹1,000. Interest is compounded annually and paid upon maturity. Investments also offer tax benefits.
4. Senior Citizen Savings Scheme (SCSS)
SCSS offers an annual interest rate of 8.2% for those aged 60 and above. Investments can range from ₹1,000 to ₹30 lakh. Interest is credited directly to the bank account every quarter, ensuring regular income.
5. Kisan Vikas Patra (KVP)
Investments in Kisan Vikas Patra double in approximately 115 months (approximately 9 years and 7 months). The interest rate is 7.5%. This is a government-backed, safe, and easy investment option.
How and Where to Invest
All of these schemes are available at post offices and select bank branches across India. To invest, you can visit a branch to fill out a form and submit KYC documents. Online investment options are also available for PPF and SSA at some banks.
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