Bank FD seems to be the first option for savings but at present many small savings schemes of the government are giving more interest than bank FD. The government has kept the interest prices of all these schemes stable in the April-June 2026 quarter, which means that investors are still getting guaranteed returns ranging from 7.4% to 8.2%.
In the quarter of April-June 2026, the government has kept the rates of all these schemes the same as before. This means that if you invest money in these now, this rate will be locked for the entire time. Apart from this, tax is also saved on most of the schemes under Section 80C. These schemes are not for just one type of investor, some want income every month, some want to keep money in a safe place after retirement and some want to save for their daughter’s future.
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1. Time Deposit Account
This scheme works exactly like bank FD, the only difference is that the returns here are higher. It offers 7.5% interest for a tenure of five years and the government has maintained this rate in the quarter of April-June 2026 also. There are four options, one, two, three and five years, so that you can choose the tenure as per your need. The minimum investment starts from just Rs 1,000 and there is no maximum limit. Interest is calculated on quarterly basis and credited to the account every year. Tax exemption under section 80C is also available on the five-year option which makes it more beneficial. If needed, money can be withdrawn after 6 months, although the interest on it will be slightly less.
2. Monthly Income Scheme
This scheme is best for those who want a fixed income every month. Post Office Monthly Income Scheme (POMIS) is a scheme in which you invest money once and interest on it comes directly into the account every month. At present 7.4% annual interest is being given on it. For retired people or those who do not work, it acts like a kind of fixed monthly salary.
A maximum of Rs 9 lakh can be invested in a single account and Rs 15 lakh can be invested in a joint account. Maturity is of five years and after maturity, if you wish, you can reinvest the same principal amount again for five years. One thing to keep in mind is that this scheme does not provide tax exemption under Section 80C.
3. Senior Citizen Savings Scheme (SCSS)
This scheme is specially designed for senior citizens in which the investment limit is up to Rs 30 lakh and the current interest rate is 8.2%. For people above 60 years of age, this is the scheme giving the highest returns among any government savings scheme. People of 55 years of age taking VRS (Voluntary Retirement Scheme) can also invest in it. Maturity is of five years which can be extended by three more years. That means you can get a fixed return of 8.2% for full 8 years. Tax exemption is also available under Section 80C which makes it a strong option for retirement.
4. National Savings Certificate (NSC)
NSC is a tax-friendly and risk-free savings scheme with a maturity of five years and an interest rate of 7.7%. This is a good option for those who want a big amount after 5 years by investing lump sum money. Investment can be started with Rs 100, that is, this scheme can be started even if you do not have much money in your pocket. The biggest feature of this scheme is that the interest received every year keeps getting added back to the same scheme due to which one gets the full benefit of compounding. NSC can also be placed with banks or housing finance companies as collateral for loans. The benefit of tax exemption is also available in Section 80C.
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5. Sukanya Samriddhi Yojana
This is the most popular and highest return giving government scheme for the future of the daughter. Currently 8.2% annual interest is being given on SSY which is compounded annually. A minimum of Rs 1,000 and a maximum of Rs 1.5 lakh can be deposited in a financial year. This account is opened in the name of a daughter below 10 years of age. It matures after 21 years from the date of account opening or when the daughter gets married after 18 years of age. This scheme provides tax exemption on investment, interest and maturity. This is also called ‘triple tax benefit’ scheme. Up to 50% of the amount can be withdrawn at the age of 18 years for the daughter’s education.
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