10 Best Government Schemes to Invest in India

Best Government Schemes Government schemes are extremely popular among retail investors as they are considered to be the safest investment option in India.  Government schemes are perfect for low-risk investors as the safety of principal is guaranteed by the government of India.  But government schemes are not just for low risk investors. Government schemes are also perfect for individuals looking to diversify their equity portfolio.  A recent data from PFRDA revealed that the AUM of government schemes like Atal Pension Yojana (APY) and National Pension Scheme (NPS) has grown to a whopping Rs 5 Trillion!  Today we will look at the 10 best government schemes in India, their performance, suitability etc. 

List of 10 Best Government Schemes in India 

Government SchemeLatest Interest RateLock-in periodMinimum InvestmentMaximum Investment Limit
National Savings Certificate (NSC)6.80%5 yearsRs 1,000No maximum limit
Post Office Monthly Income Scheme (POMIS)6.60%5 yearsRs 1,000Single a/c – Rs 4.5 Lakhs  Joint a/c – Rs 9 Lakhs
Post Office Saving Scheme4%5 yearsRs 200No maximum limit
National Pension Scheme (NPS)6% – 10%Till RetirementRs 1,000No maximum limit
Public Provident Fund (PPF)7.10%15 yearsRs 500Rs 1.5 Lakhs in a financial year
Sukanya Samriddhi Yojana (SSY)7.60%21 yearsRs 250Rs 1.5 Lakhs in a financial year
Atal Pension Yojana (APY)VariableTill RetirementRs 250No maximum limit
Kisan Vikas Patra (KVP)6.90%124 monthsRs 1,000No maximum limit
Voluntary Provident Fund (VPF)7% – 8.5%Till RetirementNo minimumNo maximum limit
Senior Citizens Saving Schemes (SCSS)7.40%5 yearsRs 1,000Rs 15 Lakhs

* The interest rates of these schemes are revised on a quarterly basis. The above are the latest interest rates as on 31st december 2020.

Let’s take a detailed look at the best government schemes in India

Best Government Scheme #1 - National Saving Certificate (NSC)

The National Saving Certificate (NSC) is  the best government scheme for individuals in low income groups as the minimum investment is Rs 1,000 and thereafter multiples of Rs 100 are accepted.  Key features of National Saving Certificate are: 

  • You can open an individual account or a joint account at your nearest post office.
  • Minimum investment of only Rs 1,000. No maximum limit. There are no restrictions on the number of accounts. 
  • High interest rate of 6.8% compounded annually and revised every quarter. 
  • Maturity tenure of 5 years only. 
  • Investment of up to Rs 1.5 lakh/year can be claimed as a deduction under Section 80C of the Income Tax Act. 

Best Government Scheme #2 - Post Office Savings Schemes

Similar to banks and NBFCs, post offices in India also offer a variety of savings accounts and deposits. The returns offered by post office savings schemes are generally higher than bank deposits. 

Best Government SchemesTenureInterest Minimum Deposit
Saving AccountOngoing4% Rs. 50
Recurring Deposit 5 years5.80%Rs 50
Fixed Deposit1 year to 5 years5.50%-6.70%Rs. 200

Best Government Schemes #3 - Post Office Monthly Income Scheme (POMIS)

POMIS is perfect for retirees and senior citizens as it provides them fixed guaranteed income. The POMIS scheme offers both single and joint holding facilities. The tenure of POMIS is 5 years.  Key features of National Saving Certificate are: 

  • Minimum investment of Rs 1,000 only. 
  • Maximum investment of Rs 4.5 Lakhs in single account and Rs 9 Lakhs in Joint account. 
  • Interest is paid at the end of every month till maturity. 
  • POMIS tenure is 5 years, but premature withdrawals are allowed from after 1 year. 

Best Government Schemes #4 - National Pension Scheme (NPS)

The National Pension Scheme was initially launched for government employees by the Pension Fund Regulatory and Development Authority (PFRDA). However, now it is made available to all Indians, including voluntary NRIs. NPS was launched so that individuals could plan for their own retirement. NPS is one of the best long term government schemes in India.  Types of NPS accounts: You can open any of the 2 types of NPS account: 

Type of NPS schemeMinimum depositTax benefits
NPS- Tier 1Rs.500 to Rs. 1000Under Sec 80C of Income Tax Act.
NPS- Tier 2Rs. 250No tax benefit

Best Government Schemes #5 - Public Provident Fund (PPF)

PPF is one of the best low-risk long term government schemes. PPF is favourite among investors as it enjoys EEE benefit.  E - The invested amount can be claimed as a deduction under section 80C.  E - The interest earned is tax-free.  E - The maturity amount is also tax-free.  A PPF account can be opened at your nearest post office, nationalised bank account, private banks, etc.  Key features of a PPF account are: 

  • Minimum annual contribution of Rs 500 only.
  • The current interest rate for PPF is 7.10%, but it is revised every quarter. 
  • PPF has a fixed tenure of 15 years and can be extended by five years at a time upon maturity.
  • You can avail a tax deduction upto Rs 1.5 lakh per annum as per the Income Tax Act.
  • PPF can act as collateral against a loan from a bank.

Best Government Schemes #6 - Sukanya Samriddhi Yojana (SSY)

The Sukanya Samriddhi Yojana (SSY) is one of the best government schemes for individuals with a girl child. It was launched by Prime Minister Narendra Modi as part of the 'Beti Bachao, Beti Padhao Yojana'. Sukanya Samriddhi scheme helps investors save for the education and marriage of the girl child. Key features of Sukanya Samriddhi Yojana are: 

  • Parents of girls aged below ten years can open a Sukanya Samriddhi Account.
  • Parents can open up to two such accounts, in case they have more than one daughter. 
  • The account will mature after 21 years or when the girl marries after attaining 18 years.
  • You can open the account with a minimum amount of Rs 250 per annum at your nearest bank or post office.
  • The current interest rate on sukanya samriddhi account is 7.6%
  • You can avail a tax deduction upto Rs 1.5 lakh per annum as per the Income Tax Act.

Best Government Schemes #7 - Atal Pension Yojana

The Atal Pension Yojana was launched in 2015. It is one of the best government schemes for the unorganised sector such as domestic help, construction workers, etc.  Key features of Atal Pension Yojana:

  • Beneficiaries between the ages 18 to 40 years can apply for Atal Pension Yojana. 
  • The amount you invest in the scheme will determine the pension you will receive upon retirement. You can choose a fixed monthly income of Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000 or Rs 5,000 after you are 60 years old.
  • Monthly contributions have to be made for a minimum of 20 years.

Best Government Schemes #8 - Kisan Vikas Patra

Kisan Vikas Patra is one of the oldest and most successful government schemes introduced for farmers. The scheme guarantees to double the invested amount by maturity. Initially, Kisan Vikas Patra was meant as a saving option for farmers but is now open to all.  Key features of Kisan Vikas Patra:

  • You can buy a Kisan Vikas Patra from any post office or nationalised bank.
  • The tenure of Kisan Vikas Patra is 124 months, and the minimum deposit amount is Rs 1,000. 
  • Kisan Vikas Patra scheme can be held as collateral for a bank loan.
  • The current interest rate of KVP is 6.9% but is revised by the government quarterly.

Best Government Schemes #9 - Voluntary Provident Fund

The Voluntary Provident Fund is specifically meant for salaried employees. It is an additional contribution that you make towards your provident fund account Key Features of Voluntary Provident Fund:

  • The current interest rate is 7% to 8.65 % per annum but is revised quarterly. 
  • The accrued interest is also exempt from tax. 
  • You can avail a tax deduction of upto Rs 1.5 lakh per annum as per the Income Tax Act. 

Best Government Scheme #10 - Senior Citizens Saving Schemes

The Senior Citizens Saving Scheme is one of the best government schemes launched specifically for senior citizens, above 60 years of age.  But special consideration is made for defence personnels. The tenure of SCSS is 5 years. But it can be extended for a block period of 3 years post maturity. The interest rate for SCSS is 7.4% compounded and paid quarterly.  Key Features of Senior Citizens Savings Scheme: 

  • Both single and joint accounts are allowed. But a joint account can only be opened with your spouse. 
  • Minimum investment amount in SCSS is Rs 1,000 while the maximum amount is Rs 15 Lakhs. 
  • Investment in SCSS qualifies for deduction under section 80C. 
  • Interest income is taxable, if the total interest earned exceeds Rs 50,000 in a financial year. 
  • Premature withdrawal is allowed post completion of the 1st year. 


If you are not comfortable with the stock market and would rather earn average but guaranteed returns then the above best government schemes are the best investment option for you.  But if you are tired of earning mediocre returns and would like to invest in stocks but in a safe manner, then StockBasket is the solution to all your needs.  StockBasket is the perfect method of investing in the stock market and achieving  diversification through expertly curated baskets of stocks.  StockBasket has expertly curated baskets such as: 5-year low risk basket, 5-year high risk basket, 4x in 10 years basket and many more!  To invest in these expert curated baskets, open a StockBasket account today and beat the returns of best government schemes -------------------------------------------------------------------------------------------------------------------------------------------------- Samco has been awarded as the best equity stock broker in India by CNBC – Awaaz. Open a 3-in-1 Samco Demat account today and beat the returns of government schemes

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