Responses to slashing PPF interest rates
Not only individuals but large Banks too responded to the recent slash of interest rates on small savings. SBI, in a research paper ( ! ) suggested that :
Instead of cutting the interest rate on PPF , Govt should have based it on investor's age. An age-wise interest structure would be ideal. The rate should be higher than the market rates for investors above the age of 45.
The current 15 year lock-in period for PPF also should be removed.
And SBI gives many more suggestions !
In the meanwhile, Fin Minister said :
" There cannot be a situation where the bank lending rates have to come down but the deposit rates are high. They both are linked "
Instead of cutting the interest rate on PPF , Govt should have based it on investor's age. An age-wise interest structure would be ideal. The rate should be higher than the market rates for investors above the age of 45.
The current 15 year lock-in period for PPF also should be removed.
And SBI gives many more suggestions !
In the meanwhile, Fin Minister said :
" There cannot be a situation where the bank lending rates have to come down but the deposit rates are high. They both are linked "
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