Post office savings bank interest rate amended

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FE Report
The post office savings bank has been allowed by the government to pay interest at compound rates instead of existing simple rate to the account holders to encourage more investment, official sources said.
The government made the decision through an amendment of the interest rate policy which will come into retrospective effect from July 17, 2004.
The Ministry of Finance has already issued an order in this connection, the sources added.
Under the amendment, the investors will receive compound interest on their account balance after every three to six months maturity period.
"The investors will receive compound interest on such account following amendment to the policy," a senior official of the National Savings Directorate told the FE Sunday.
He also said all kinds of misunderstanding about receiving compound interest on such accounts has been removed after the order was issued.
Currently, investors receive interest on ordinary account maintained with the post office savings bank at 7.50 per cent.