New Delhi: In a recently held emergency meeting the Reserve Bank of India (RBI) slashed its benchmark repurchase (repo) rate by 75 basis points and its reverse repurchase rate by 90 basis points. The repo rates fell to 4.40 per cent and reverse rate to 4.00 per cent, from 5.15 per cent and 4.90 per cent.

The government has gone ahead and introduced sharp cuts in the interest rate on small savings schemes, including the popular Public Provident Fund or PPF, which is in tune with a moderation in overall interest rate in the financial system. These new rates are applicable for this quarter, from 1st April to 30th June 2020. The rates are typically announced on a quarterly basis for small savings schemes.   Here is the impact on your small savings schemes:

PPF: One of the most popular long-term savings schemes, PPF, which matures in 15 years, has seen an interest rate cut of 80 basis points. For this quarter, PPF will fetch 7.1 per cent as compared to 7.9 per cent earlier.

Senior citizen savings scheme: Even the schemes for senior citizens will not be immune of the rate cut. The senior citizens scheme will be offering 7.4% against previous 8.6%.

Sukanya Samriddhi Yojana: This scheme is hugely popular for parents of a girl child. Now, girl child savings scheme Sukanya Samriddhi Yojana will earn a lower rate of 7.6 per cent, against 8.4 per cent earlier.

NSC: The rate cut has brought down interest on National Savings Certificate at 6.8 per cent  compared to 7.9 per cent earlier.

Five-Year Post Office RD: If you hold a recurring deposit scheme offered by post offices, then the new investors will get 5.8 per cent, as compared to 7.2 per cent earlier.

KVP:  Also, the Kisan Vikas Patra (KVP) will be now maturing or doubling in value in 124 months as opposed to 113 months and giving a lower yield of 6.9 per cent as compared to 7.6 per cent earlier.

Post Office Term Deposits: For those with post office term deposits of 1-3 years will now earn an interest rate of 5.5 per cent as against 6.9 per cent, down 140 basis points. While the rates on the five-year term deposit has been cut to 6.7 per cent from 7.7 per cent.

Small savings schemes typically attract rates based on comparable yields on government securities but they have not been strictly followed in some quarters, according to analysts. The only rates which remain untouched are the interest on savings deposits which will continue to fetch 4 per cent annually.