In line with the revision of interest rates of small savings schemes, interest rates for the National Small Savings Fund (NSSF) loan to Centre and States for FY 2016-17 has been revised and fixed at 8.8% in place of 9.5%.

The National Small Savings Fund (NSSF) invests its net collection as loan to Centre and State/UT Governments. The interest rate of NSSF loan to Centre and States for Financial Year 2015-16 was 9.5%. This interest rate was felt to be burdensome on States’ economies.

In the context of easing the transmission of the lower interest rates in the economy, the Government has taken a comprehensive view on the social goals of certain National Small Savings Schemes. The interest rates for First Quarter of the Financial Year 2016-17 in respect of various small savings schemes were communicated through O.M. dated 18.3.2015.

NSSF loan interest rate revised downward for centre and states, easing interest transmission and reducing state burden. The Government lowered the NSSF loan interest rate for loans from the National Small Savings Fund to the Centre and State/UT Governments for FY 2016-17, replacing the prior year's higher rate because it was deemed burdensome on State finances and to aid transmission of lower economy-wide interest rates.