Mumbai: With the Reserve Bank of India slashing its repo rate again, post office fixed deposits are pulling ahead of bank options, offering better and more reliable returns for everyday savers.
The RBI has trimmed the repo rate several times this year, dropping it to 5.25 per cent by early December. Banks have followed suit, cutting their FD rates to about 6.5 per cent or lower for most customers. This shift has left many looking for steadier alternatives.
Time deposits at the post office, however, stay untouched by these changes. The government fixes their rates each quarter, and they remain firm. Right now, you get 6.9 per cent for one year, 7.0 per cent for two years, 7.1 per cent for three years, and 7.5 per cent for five years.
These beat what most banks provide. Plus, they come with a full government guarantee, so your money stays safe. The five-year plan even offers tax breaks under Section 80C.
Take Rs 2 lakh in a five-year post office FD at 7.5 per cent. Over time, it earns around Rs 90,000 in interest, growing to nearly Rs 2.9 lakh.
If you seek returns without the ups and downs, post office FDs make sense today. But keep an eye out — rates might adjust next quarter.