In 2025, India continues to offer several government-backed small savings schemes that provide competitive interest rates, making them ideal options for conservative investors looking for safe, low-risk avenues to grow their wealth. Whether you're aiming for tax saving, stable income, or long-term wealth creation, these schemes are designed to suit different financial goals. With interest rates reaching up to 8.2% in some cases, these savings instruments promise solid returns while being completely risk-free due to government backing. Let's explore the top small savings schemes in India for 2025 and their key features.
1. Public Provident Fund (PPF)
Interest Rate (2025): 7.9% per annum (subject to quarterly revisions)
The Public Provident Fund (PPF) remains a favorite among long-term investors. With its tax-free interest and a tenure of 15 years, it encourages disciplined saving for future goals. The scheme allows you to invest a minimum of ₹500 and a maximum of ₹1.5 lakh per year, with the flexibility to extend the account after the completion of the 15-year period. The PPF is a low-risk investment, making it a strong option for building wealth over the long term while availing tax deductions under Section 80C.
2. Senior Citizens Savings Scheme (SCSS)
Interest Rate (2025): 8.0% per annum
The Senior Citizens Savings Scheme (SCSS) is an excellent choice for individuals aged 60 years or above. Offering an interest rate of 8%, it provides regular quarterly payouts, making it ideal for senior citizens looking for stable income. The maximum investment limit is ₹15 lakh, and the scheme has a 5-year tenure. While the interest is taxable, the SCSS remains one of the highest-return options for senior citizens seeking safe investments.
3. National Savings Certificate (NSC)
Interest Rate (2025): 7.7% per annum (compounded annually)
The National Savings Certificate (NSC) is a popular fixed-income instrument that offers around 7.7% interest compounded annually over a 5-year period. It is an attractive tax-saving investment as it qualifies for tax deductions under Section 80C. The NSC is best suited for investors who prefer a safe, government-backed option with a relatively fixed return, although the interest earned is taxable.
4. Post Office Monthly Income Scheme (POMIS)
Interest Rate (2025): 7.4% per annum (paid monthly)
For those seeking regular income, the Post Office Monthly Income Scheme (POMIS) is a top choice. Offering an interest rate of 7.4% per annum, POMIS pays out interest on a monthly basis, ensuring steady cash flow. The scheme has a maximum investment of ₹4.5 lakh for individual accounts and ₹9 lakh for joint accounts, with a tenure of 5 years. While the interest is taxable, POMIS provides a reliable source of income for conservative investors.
5. Sukanya Samriddhi Yojana (SSY)
Interest Rate (2025): 8.0% per annum
The Sukanya Samriddhi Yojana (SSY) is specifically designed for the financial future of a girl child. Offering an 8% interest rate, it is one of the most rewarding schemes for parents and guardians aiming to secure their child’s education and marriage. The scheme allows a minimum annual contribution of ₹250 and a maximum of ₹1.5 lakh, with the principal and interest being tax-free. The tenure of the scheme is 21 years, making it a long-term wealth-building tool.
6. Kisan Vikas Patra (KVP)
Interest Rate (2025): 7.7% per annum (doubling in 113 months)
For a medium-term, safe investment, the Kisan Vikas Patra (KVP) offers an attractive interest rate of 7.7% per annum, with the investment doubling in 113 months (approximately 9.42 years). The scheme has a lock-in period of 2.5 years, making it suitable for conservative investors who are willing to park their money for a few years. Interest earned is taxable, but the principal remains safe as it is backed by the government.
7. National Pension Scheme (NPS)
Interest Rate (2025): 8-10% per annum (depending on fund performance)
The National Pension Scheme (NPS) is a retirement-focused scheme offering returns ranging from 8% to 10%, depending on the performance of the chosen investment fund. NPS offers significant tax benefits under Sections 80C and 80CCD and is perfect for individuals looking to save for retirement. Though the returns are subject to market fluctuations, the scheme’s low-cost structure and government backing make it a good long-term pension planning tool.
8. Government Savings Bond
Interest Rate (2025): 7.75% per annum
The Government Savings Bond offers a fixed interest rate of 7.75% per annum and comes with a lock-in period of 2 to 3 years. It is an ideal short-term safe investment option for those looking for low-risk and guaranteed returns. The bond can be purchased with a minimum investment of ₹1,000, and the interest earned is taxable. It’s a great choice for those who need a secure place to park their money for a few years.
9. Tax-Saving Fixed Deposits (FDs)
Interest Rate (2025): 7.0% to 7.5% per annum
Tax-saving Fixed Deposits (FDs) offer an interest rate of around 7% to 7.5% per annum, with the added benefit of tax deductions under Section 80C. The tenure of these FDs is 5 years, and the interest earned is taxable. These FDs are perfect for individuals looking for short-term tax-saving options while enjoying guaranteed returns. However, the interest rate might be slightly lower compared to other schemes, but the principal remains secure.
10. Pradhan Mantri Vaya Vandana Yojana (PMVVY)
Interest Rate (2025): 7.5% per annum
The Pradhan Mantri Vaya Vandana Yojana (PMVVY) is a pension scheme for senior citizens, offering an interest rate of 7.5% per annum. The scheme provides various payout options, including monthly, quarterly, or annual payouts, making it an excellent choice for senior citizens who need a stable source of income. The maximum investment is ₹15 lakh, and the tenure is 10 years. While the interest earned is taxable, the PMVVY ensures financial security for senior citizens.