Fall in savings

Slow down in small savings

One often sees an inverse relation between small savings schemes and bank deposits. The term deposits have been been registering a robust growth, since December 2010 due to successive hikes in interest rates. But at the same time, the pace of growth in small savings schemes has slowed down. This is because the small savings rate are administered rates fixed by the government and have not been changed for almost a decade now. In contrast, bank deposit rates are market determined.