#NewDelhi: In the Lok Sabha session on Monday, the central government said that in the fiscal year 2020-21 (FY2020-21), the number of customers in Indian Post Office savings accounts, time deposits and other small projects has come down sharply. This number is the lowest in the last 3 financial years. In addition, according to estimates, the index will continue to decline until November of the 2021-22 financial year (FY2021-22). This information was brought to the fore while answering a question in the Lok Sabha.
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In the financial year 2018-19 (FY2018-19) a total of 4.85 crore small savings accounts were launched. In the fiscal year 2019-20 (FY2019-20) this number decreased to 4.12 crore and in the financial year 2020-21 (FY2020-21) it dropped to 4.11 crore.
According to FY2021-22 estimates, only 2.33 crore small savings accounts have been opened at the Indian Post Office so far this financial year.
The last 3 years have seen the biggest collapse in the number of new savings account launches at the post office. This number decreased from 1.18 crore accounts in 2018-19 financial year and reached only 61.1 lakh in 2020-21 financial year. Although the number of Public Provident Fund (PPF) accounts increased in FY2019-20, it declined again in FY2020-21. In FY2019-20, the number of new PPF accounts jumped from 11.5 million to 26.2 million and in FY2020-21 it dropped from 26.5 million to 19.8 million. In the financial year 2021-22, this number has reached only 3 lakhs.
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The last three years have also seen a decline in interest rates on small savings accounts. In the first quarter (Q1) of FY2018-19, the 1-year post office time deposit interest rate was 7.6%. At present, in the third quarter (Q3) of FY2021-22, the same scheme pays an annual interest of 5.5%. The interest rate on 3-year post office time deposit scheme has come down to 5.5% from 6.9% in the last 3 financial years. The interest rate on PPF accounts also goes down from 7.6% to 8.1%.
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Note that even if the post office interest rate is reduced, it is always higher than the fixed deposit (FD) rate of the bank. Although banks have reduced interest rates on FD schemes, the government has not changed interest rates on small savings accounts since the first quarter of the 2020-21 financial year.
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