Post office savings, PPF to fetch better returns from Dec 1

PPF account holders, small depositors and persons keeping money in the schemes operated by post offices, will get higher rate of return from December 1, 2011.

The government on Thursday notified an increase in interest rates on public provident fund (PPF) to 8.6 per cent from 8 per cent now, and also raised ceiling on annual contributions to the fund to Rs 1 lakh from Rs 70,000.

Interest rates for savings accounts in post offices will also go up to 4 per cent from 3.5 per cent at present. 

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Similarly, interest rates on deposits of other maturities too will be raised from December.

Further, the sale of Kisan Vikas Patras (KVP) will be discontinued from November 30. There was an apprehension that KVP was used for money laundering.

In addition, the maturity period of monthly investment schemes (MIS) and national savings certificates will be reduced from six to five years.

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