PPF Interest Rate October 2026: Will PPF Rate Increase? New PPF Rate, SCSS, SSY & NSC Rates Explained

Why PPF Has Stayed at 7.1% for Six and a Half Years

PPF paid 7.9% until 31 March 2020 and was cut to 7.1% from 1 April 2020. It has not moved since, through RBI's rate cuts of 2020, its increases of 2022 and 2023, and its cuts of 2025. The one time the government did announce another cut, taking PPF to 6.4% for April–June 2021 in a memo dated 31 March 2021, it withdrew the memo the next day.

The formula is a guide the government uses when it chooses to, not a rule it must follow, and for PPF the gap has run both ways. In RBI's October 2025 report the PPF formula rate was 6.83%, below the 7.1% paid; for July–September 2026, the same method gives about 7.4%, above it. Both times the answer was 7.1%.

In real terms, retail inflation was 4.82% in August 2026, so PPF is paying a little over 2 points above inflation, tax-free. That is thin but positive, which is why I see PPF as a steady part of long-term savings rather than the whole of it.

Which Rate Changes Touch Money You Already Have

This is the part of the announcement that decides whether you need to do anything at all.

PPF and Sukanya Samriddhi float. The notified rate applies to your whole balance for that quarter. A change on 30 September changes what your existing PPF or SSY account earns from 1 October.

SCSS, NSC, KVP, the Monthly Income Scheme and the time deposits lock in. You earn the rate that applied on the day you invested, for the full term. If you opened an SCSS account at 8.2%, a cut announced today does not touch it, and a rise does not reach it either.

The date inside the month matters more than the quarter for PPF. PPF pays interest on the lowest balance between the 5th and the last day of each month. Put ₹1.5 lakh in on 6 October instead of the 5th and you lose October's interest on it: about ₹887 at 7.1%. For comparison, a 0.1 percentage point change in the PPF rate is worth about ₹37.50 on the same ₹1.5 lakh for a whole quarter. The PPF account guide covers the rest of the scheme's rules.

SCSS Interest Rate: 8.2%, Locked for Five Years

The Senior Citizens Savings Scheme pays 8.2%, credited every quarter, and the rate you open at stays for the five-year term. It is open to those aged 60 and above, with earlier entry for some retirees, up to ₹30 lakh per person, so a full account at 8.2% pays ₹61,500 a quarter. The interest is taxable at your slab rate, and TDS applies once a senior citizen's interest from a post office or bank crosses ₹1 lakh in a year. The deposit qualifies for the old regime's ₹1.5 lakh deduction, the one still called 80C (section 123 of the Income-tax Act, 2025). An account can be extended in three-year blocks, and an extended account earns the rate in force on the date it matures, not its old rate. I've written about where SCSS fits in a retiree's income in senior citizen investment options.

Sukanya Samriddhi Interest Rate: 8.2%, and It Floats

Sukanya Samriddhi Yojana pays 8.2%, the rate it has paid since January 2024, and like PPF the rate applies to the whole balance each quarter. The account is opened for a girl below 10, takes up to ₹1.5 lakh a year for 15 years, and matures 21 years after it is opened. The interest and the maturity amount are tax-free, and the deposits qualify for the old regime's 80C deduction. Because the rate floats, 8.2% is today's rate, not a promise for 21 years; the Sukanya Samriddhi guide goes through how I would set one up.

NSC Interest Rate: 7.7%, Fixed at Purchase

The National Savings Certificate pays 7.7%, compounded once a year and paid at the end of five years. At 7.7%, ₹1,000 becomes about ₹1,449. The rate is fixed on the day you buy, which is why a quarter's change matters here: on ₹1 lakh, 7.7% against 7.5% is a difference of about ₹1,340 over the five years. The interest is taxable, although under the old regime the interest for the first four years counts as reinvested and qualifies for the 80C deduction. The post office schemes guide compares NSC with KVP, MIS and SCSS.

PPF Against a Bank FD This Quarter

Some of my own savings sit in fixed deposits, so the first thing I put next to a small savings table is a bank FD rate. SBI pays 6.05% on deposits of five to ten years to the general public and 7.05% to senior citizens, rates in force since 15 December 2025. FD interest is taxed at your slab, and PPF interest is not. In the 30% slab, with cess, 6.05% leaves about 4.2% after tax, so PPF's 7.1% is ahead by close to 3 points, in exchange for a 15-year lock-in. For a retiree the cleaner comparison is SCSS against a senior citizen's FD: 8.2% against 7.05%, both taxable. The FD calculator and the PPF calculator put your own amounts side by side, and the guide to tax on FD interest covers TDS and the forms.

What I'd Do With Money That Has to Be Placed in October

At the mill, a rate change is a line in a spreadsheet before it is anything else, so here is how I would think about October, as someone who is not recommending any scheme.

Don't wait on the announcement with money you have to place anyway. The memo comes out on the evening of the last working day of the quarter and applies from the next morning, so there is no timing trick left for anyone. On ₹1 lakh in NSC, a 0.2 point move either way is worth about ₹1,340 over five years. That is real money, but it is smaller than the cost of leaving the ₹1 lakh idle for months while you wait for a better rate.

Match the lock-in to the date you need the money. Paddy starts reaching mills like ours at the end of September, and the farmers who sell it get paid through the harvest season. Say one of them wants somewhere safe for the money until the next sowing. PPF (15 years) and NSC (five years) are the wrong tools for that, whatever the rate. A one-year post office time deposit or a bank FD fits the timeline. The rate only matters once the tenure fits.

For PPF, watch the 5th, not the 30th. If you add to PPF, the deposit date inside the month is worth more this quarter than any likely rate change, as the ₹887 against ₹37.50 above shows.

For SCSS, the rate you get is the rate you keep. A retiree opening an account in October locks in whatever the government notifies today for five years. That is the one scheme where I would read the new table before signing, not after.

I'll update this page when the October–December 2026 rates are notified, with the new table and what changed.