Interest on FRS is paid every half year. Interest is released twice a year – on 1st January and 1st July. The interest money that will be added to the account on January 1 and July 1, will be given 35 basis points more than the interest rate of the NSC on that day.
Reserve Bank’s Floating Rate Saving Bond gives returns at 7.15 per cent rate (indicative picture)
National Savings Certificate (NSC) has a lot of name when it comes to taking more interest on investment. NSC comes with a fixed maturity of 5 years and is currently paying interest at the rate of 6.8 per cent. This is a satisfactory interest rate as compared to any other savings scheme. But when there is a scheme giving more interest than this and that too is run by the government, then why should no one invest in it. There is one such scheme named Floating Rate Saving Bonds 2020 which is run through the Reserve Bank of India (RBI). The specialty of this floating rate saving bond is its interest rate which is higher than that of NSC.
If you look at the interest rate of the Reserve Bank’s Floating Rate Saving Bond (FRS), it gives 35 basis points more interest than NSC. Currently, interest on NSC is getting at the rate of 6.8 percent. FRS is paying 35 basis points more interest than that. Interest on FRS is paid every half year. Interest is released twice a year – on 1st January and 1st July. The interest money that will be added to the account on January 1 and July 1, will be given 35 basis points more than the interest rate of the NSC on that day.
how much interest will you get
According to this, the interest rate of NSC is 6.8 percent now and if you add an additional 35 basis points to it, then this rate will become 7.15 percent. According to the Reserve Bank, currently the coupon rate of FRS 2020 is applicable from July 1, 2021 to December 31, 2021. The maturity of this bond will be issued on January 1, 2022 and the amount will be given to the customers by adding 7.15 percent interest on their investment. In July this year also, the maturity of FRS was given at the rate of 7.15%.
How much can you invest
One can deposit a minimum of Rs 1000 and multiples of Rs 1,000 in the Reserve Bank’s Floater Rate Saving Bonds or FRS. There is no limit on the maximum investment in this bond. The bond matures after 7 years from the date on which this bond is purchased. That is, this bond of the Reserve Bank is bought for 7 years. Its maturity is completed after 7 years.
Nominee rule
The way there is a rule of making a nominee in other investment schemes, so is it in floating rate savings bonds. However, the nomination facility is given to the ‘sole holder’ i.e. the single account opener taking FRS. Even if two people take this bond in a joint, then only one will get the facility of nomination. Keep in mind that this bond is not transferable. That is, a person cannot transfer his bond to any other person. Only the person who takes this bond will be given the benefit of investment.
Read also: You can also repay the loan of gold loan by giving gold to the bank, know what the RBI rule says
.
