Government-backed saving plans in India have long served as a reliable way for individuals to grow their savings while maintaining financial security. These schemes are popular among both salaried and self-employed individuals due to their risk-free nature, fixed interest rates, and sovereign guarantees. Some of them even allow partial withdrawals, making them suitable for long-term as well as emergency needs.
Let us explore some of the most flexible and secure saving plans offered by the government in 2025.
Atal Pension Yojana (APY)
Targeted at unorganised sector workers, APY offers a fixed pension amount after retirement. Subscribers contribute regularly until the age of 60, after which they start receiving the pension. The minimum investment is Rs. 1,000 per year, and interest rates are currently at 8%. The scheme is especially useful for those with no access to employer-provided retirement options like EPF or term insurance-linked policies.
Post Office Monthly Income Scheme (POMIS)
This scheme is designed to provide steady income through monthly interest payouts. With a five-year lock-in period and an interest rate of 7.40%, POMIS is suitable for retirees and conservative investors looking for assured returns. A minimum investment of Rs. 1,000 is required, and partial withdrawals are not allowed, although premature closure is permitted under certain conditions.
Kisan Vikas Patra (KVP)
KVP doubles the invested amount in approximately 115 months at the current interest rate of 7.50%. There is no upper investment limit, and the minimum required is Rs. 1,000. While partial withdrawals are not allowed before the maturity period, the plan offers decent liquidity options after a lock-in period.
National Pension Scheme (NPS)
One of the most versatile saving plans in India, NPS allows partial withdrawals for specific reasons such as medical needs or children’s education. Contributions are market-linked, offering potential returns between 9–15%. This scheme is open to both private and government sector employees and is especially useful when combined with a term insurance policy to enhance retirement security.
National Savings Certificate (NSC)
NSC is a fixed-return investment with a five-year tenure and current interest rate of 7.70%. It is suitable for conservative investors looking to save tax under Section 80C. Although premature withdrawal is not permitted, the certificates can be pledged as collateral for loans.
Public Provident Fund (PPF)
PPF offers long-term financial security with tax-free interest income. It has a 15-year lock-in, an annual interest rate of 7.10%, and allows partial withdrawals after the sixth year. It is one of the most trusted saving plans for retirement and can be used in conjunction with term insurance to ensure financial protection for the family.
Employees’ Provident Fund (EPF)
Meant for salaried employees, EPF mandates monthly contributions from both employer and employee. The current interest rate is 8.25%, and funds can be partially withdrawn for events like home purchase or medical emergencies. It is one of the few retirement-focused plans with such withdrawal flexibility.
Senior Citizens Savings Scheme (SCSS)
With a 5-year tenure and 8.20% interest rate, SCSS is perfect for individuals above 60 years. It ensures regular income and allows early closure with penalties. Partial withdrawals are not allowed, but the scheme remains a favourite for retirees.
Sukanya Samriddhi Yojana (SSY)
SSY supports the long-term welfare of a girl child. With a lock-in until marriage or 21 years of age and interest rate of 8.20%, it offers tax-free returns. Partial withdrawals are allowed after the girl turns 18, which is useful for education expenses.
Conclusion
Government saving plans remain a reliable foundation for financial planning in India. While they may not promise very high returns, they offer unmatched security, steady interest income, and features like partial withdrawals and tax benefits. When used alongside protection instruments like term insurance, these plans create a well-rounded portfolio that balances growth and safety. Choosing the right mix depends on your financial goals, risk appetite, and time horizon.
