Saving Schemes in India which Provide Compound Interest

Recently a reader ask me a question, “Which are the Saving Schemes in India which provide Compound Interest?”

Well, this is very true question. The Compound Interest is very necessary for anyone to become rich and financially free. In fact, Banks and Financial institutions won’t forget to charge compound interest from you when they give you a loan.

Now Let me tell you that, A Simple Interest simply doesn’t exist in real life. Its a theoretical only. In real life only Compound interest exists.

So you chose any saving scheme of India, It will give you the compound interest only.

There is only one exception in this rule. And that is Bond issues. Many companies and government sometimes issue Bonds to the public. Say for Example, ICICI Bank & NABARD Bonds have issued bonds to the public. And in these issues, for a marketing purpose, they told people to offer 12% per Annum interest rate. But there was * beside it.

And the * says, Simple Interest only.

This was a trap. Many people believed that both of these bonds will give them 4% higher return than Government Bonds. But the government Bonds give you 8% Compounded annually return while these Bonds offer you 12% but simple interest which is 8% Compounded annually return.

I had received several queries during the issues of NABARD & ICICI Bonds about this matter. So Don’t worry and invest in any Saving Scheme of India. All of them will give you the Compounded Annual Returns only…!!!