Bonds & Government Schemes — Updated Monthly
Government-Backed.
Higher Than FD.
Tax-Free (Some).
PPF, SCSS, RBI Bonds, and NSC beat most FDs — with sovereign guarantee. Some are completely tax-free. We compare every government scheme and corporate bond platform with post-tax yields at every bracket.
8.20%
SCSS Rate (Best for 60+)
8.05%
RBI FRSB Rate (No Cap)
7.10%
PPF Rate (Tax-Free EEE)
₹30L
Max SCSS Investment
Source: RBI, Ministry of Finance, Post Office — April 2026
What We Cover
Every Bond & Scheme
Worth Knowing.
Government-backed instruments, post office schemes, corporate bonds, and G-Secs — compared honestly with post-tax yields at every bracket.
PPF (7.10%, Tax-Free)
15-year lock-in but EEE status — no tax on investment, interest, or maturity. Beats FD post-tax at 20%+ bracket. Max ₹2L/year.
👴SCSS (8.20%)
Best deal for 60+. ₹30L max. Quarterly payout = ₹2.46L/year guaranteed. 80C deduction. Government-backed.
📈RBI Floating Rate Bonds
8.05% sovereign-guaranteed. Resets every 6 months. 7-year lock-in. The highest zero-risk yield with no investment cap.
📜NSC (7.70%)
5-year lock-in. 80C benefit + accrued interest trick. Interest compounded annually but taxable. Good for moderate tax-bracket investors.
🪙KVP (7.50%)
Doubles your money in 115 months. No max limit. No TDS — pay tax via ITR. Simple and predictable.
💰MIS — Monthly Income
7.40% paid monthly. Max ₹9L (single), ₹15L (joint). No TDS. Ideal for retirees needing regular cash flow.
👧SSY — Sukanya Samriddhi
8.20% with full EEE tax status. For parents of daughters under 10. Max ₹1.5L/year. Best girls' savings scheme in India.
🏢Corporate Bonds
9-12% yields via GoldenPi, Wint Wealth, Grip Invest. But credit risk is real — DHFL was AA-rated before defaulting. TruCap defaulted July 2025 with ₹55Cr retail exposure.
🏛️Government Securities
G-Secs via RBI Retail Direct. 7-8% sovereign yield. Trade on exchange. Starts at ₹10K. Zero credit risk.
🥇Gold After SGBs (Discontinued)
SGBs are dead — Rs 2.2L Cr liability killed them. Gold ETFs at 0.50% expense ratio are the best alternative. Digital gold costs 5-7% upfront.
🧮Post-Tax FD Yield
7% FD = 4.82% at 30% bracket. Cumulative FD tax trap, TDS cliff, Form 121, NRI TDS at 31.2%, and why PPF beats every FD post-tax.
🏦Best FD Rates (April 2026)
Unity SFB 8.60%, Suryoday 8.40%, Muthoot 8.50%. 40+ banks compared with post-tax returns, premature penalties, and DICGC insurance math.
Government-Backed Instruments
Higher Than FD.
Safer Than FD.
Sovereign-guaranteed instruments that most Indians don't know about — or don't understand. Every one of these beats the average bank FD.
| Scheme | Rate | Lock-in | Tax Status | Max Investment | Best For |
|---|---|---|---|---|---|
| SCSS | 8.20% | 5 years | 80C. Interest taxable | ₹30 lakh | Retirees (60+) |
| SSY | 8.20% | Till girl turns 21 | EEE (fully tax-free) | ₹1.5L/year | Parents of daughters |
| RBI FRSB | 8.05% | 7 years | Fully taxable + TDS | No limit | No-ceiling sovereign yield |
| NSC | 7.70% | 5 years | 80C. Interest taxable | No limit | Tax saving |
| KVP | 7.50% | 115 months | No TDS. Tax via ITR | No limit | Doubling money |
| MIS | 7.40% | 5 years | No TDS. Tax via ITR | ₹9L single | Monthly income |
| PPF | 7.10% | 15 years | EEE (fully tax-free) | ₹1.5L/year | Long-term, 30% bracket |
Rates for April-June 2026 quarter. Source: Ministry of Finance, RBI
The Number That Actually Matters
Post-Tax Yields
At Every Bracket.
PPF at 7.1% beats a 7.5% FD at 30% bracket. But at 0% bracket, FD wins. Your tax slab changes everything.
| Instrument | Pre-Tax Rate | At 0% Slab | At 20% Slab | At 30% Slab | Note |
|---|---|---|---|---|---|
| PPF | 7.10% | 7.10% | 7.10% | 7.10% | EEE — tax-free at every bracket |
| SCSS | 8.20% | 8.20% | 6.56% | 5.74% | 80C deduction offsets partially |
| RBI FRSB | 8.05% | 8.05% | 6.44% | 5.64% | No 80C. Fully taxable |
| NSC | 7.70% | 7.70% | 6.16% | 5.39% | 80C on investment only |
| Bank FD (Best) | 7.50% | 7.50% | 6.00% | 5.10% | Taxable. TDS at source |
| SSY | 8.20% | 8.20% | 8.20% | 8.20% | EEE — same as PPF |
Key takeaway: At 30% bracket, PPF (7.10% tax-free) beats a 7.5% FD (5.10% post-tax) by nearly 2 percentage points. SCSS and RBI FRSB also beat FDs post-tax despite being taxable, because their pre-tax rates are significantly higher. At 0% bracket, taxable instruments win because you keep the full rate.
Post-tax rates exclude cess for simplicity. Actual effective rates slightly lower at 20% and 30% brackets due to 4% health and education cess.
Higher Yield, Higher Risk
Corporate Bonds:
9-12% With a Catch.
Platforms make them accessible. But credit risk is real — and the defaults that matter most are the ones nobody predicted.
GoldenPi
Oldest Platform
250K+ investors. Zerodha-backed. Wide selection of bonds and debentures. Minimum varies by bond. Best for experienced investors who want choice.
Wint Wealth
Curated Selection
25K+ investors. Starts at ₹10K. Pre-screened bonds only. In-house credit evaluation. Best for beginners who want a vetted selection.
Grip Invest
Fractional Bonds
Fractional bond investing at lower ticket sizes. Also offers lease financing and inventory financing. Best for small investors exploring alternatives.
Credit Risk Is Real
DHFL was rated AA by CARE before defaulting in 2019. IL&FS had AAA sub-ratings from ICRA before its collapse. Retail investors who bought these bonds lost most of their principal. A credit rating is an opinion, not a guarantee. The bonds that default are often the ones nobody expected to.
Credit Rating Scale — What Each Rating Means
AAA
Highest safety. Sovereign-adjacent.
AA+ / AA
High safety. Very low default risk.
A / BBB
Moderate risk. Not for retail.
BB and below / D
High risk to default. Avoid.
Our Rule: Stick to AA+ or above rated corporate bonds. Limit corporate bonds to 5-10% of your total portfolio. Never chase yield — if a bond is offering 14-15%, ask why nobody else wants it. For the remaining 90%+, use sovereign-backed instruments.
Myths vs Reality
Stop Believing These
About Bonds.
"Bonds are only for old people"
PPF is the single best debt instrument for anyone in the 20-30% tax bracket — regardless of age. At 7.1% tax-free, it beats every FD post-tax. SSY at 8.20% (EEE) is the best investment for parents of young daughters. Age has nothing to do with it — your tax bracket does.
"PPF rate is low at 7.1%"
PPF's 7.1% is completely tax-free (EEE). A 7.5% FD at 30% bracket gives only 5.1% post-tax. PPF's effective yield is 39% higher. At 20% bracket, PPF still beats FD by ~1%. The headline rate is misleading — always compare post-tax yields.
"Corporate bonds are safe because they're bonds"
The word "bond" implies safety, but corporate bonds carry real credit risk. DHFL was rated AA before defaulting. IL&FS had AAA sub-ratings before collapse. A bond is only as safe as the company behind it. Government bonds (sovereign) are safe. Corporate bonds are not automatically safe.
"Government bonds have low returns"
SCSS pays 8.20%. RBI FRSB pays 8.05%. SSY pays 8.20% tax-free. These beat most bank FDs. The misconception comes from confusing PPF (7.1%) with all government instruments. The full spectrum offers 7.1% to 8.2%, most of it higher than top bank FD rates.
"NPS is always better than PPF for retirement"
NPS has equity exposure (potentially 8-10%) but only 60% of maturity is tax-free. 40% must buy an annuity — which is taxable. PPF gives 7.1% guaranteed, fully tax-free. For the debt portion of retirement savings, PPF is strictly better. NPS makes sense for the extra 80CCD(1B) deduction and equity allocation — use both.
Guides & Deep-Dives
Read Before You
Lock Your Money.
Data-backed guides with post-tax calculations. Not the generic "what is a bond" content you find everywhere.
PPF vs FD vs SCSS — Which Wins at YOUR Tax Bracket?
The answer changes at 0%, 20%, and 30% brackets. PPF crushes FD at 30% but loses at 0%. Decision matrix included.
Read Guide → Deep-DiveRBI Floating Rate Savings Bonds — Complete Guide
8.05% with no ceiling. How the rate resets, who should buy, premature exit rules for seniors, and tax implications explained.
Read Guide → StrategySCSS Retirement Playbook — Maximize ₹30L at 8.20%
How to structure ₹30L in SCSS for ₹2.46L/year guaranteed income. Ladder strategy, extension rate trap, zero-tax blueprint for couples, and death succession rules.
Read Guide → ComparisonGoldenPi vs Wint Wealth vs Grip Invest — Platform Comparison
Fees, minimum investment, available bonds, default history, and which platform suits which investor. Honest side-by-side.
Read Guide → CalculatorPost-Tax Yield Calculator — PPF, FD, SCSS, NSC Compared
Enter your tax bracket and see real returns. The most important calculation fixed-income investors never do.
Read Guide → GuideKVP & MIS for Monthly Income — How They Actually Work
KVP doubles money in 115 months. MIS pays 7.40% monthly. Step-by-step on how to buy, tax implications, and who should use these.
Read Guide → Deep-DiveSGBs Are Dead — What Gold Investors Should Do in 2026
No new SGBs after Feb 2024. Gold ETF vs digital gold vs physical gold — cost, tax, and regulation compared. The Rs 2.2L Cr fiscal disaster explained.
Read Guide → CalculatorPost-Tax FD Yield — What You Actually Keep
A 7% FD yields 4.82% at 30% bracket. After inflation, you lose money. Post-tax yields at every slab, cumulative FD tax trap, NRI TDS, Form 121 rules.
Read Guide → DataBest FD Rates in India — 40+ Banks, SFBs, NBFCs Compared
Unity SFB 8.60%, Suryoday 8.40%, Muthoot 8.50%. Post-tax returns at every slab. Premature penalties. DICGC insurance math.
Read Guide → ComparisonInvoice Discounting vs FD vs Liquid Fund vs T-Bill — Post-Tax Truth
12% invoice discounting → 8.4% post-tax. FD 7%→4.9%. T-Bill 7%→4.9% with sovereign guarantee. Risk-adjusted comparison.
Read Guide → WarningDigital Gold: The 8% You Lose Before Gold Even Moves
3% GST + 5% spread + fees = 6-8% loss on day one. Platform-wise breakdown. SGB vs ETF vs digital gold compared.
Read Guide →Quick Answers — AEO Optimised
Bond & Scheme Questions
India Asks Every Day.
Direct, structured answers — built for Google's featured snippets and AI answer engines.
What is PPF and why is it tax-free?
Public Provident Fund (PPF) is a 15-year government-backed savings scheme offering 7.10% interest. It has EEE (Exempt-Exempt-Exempt) tax status — your investment qualifies for 80C deduction (up to ₹1.5L/year), the interest earned is tax-free, and the maturity amount is tax-free. No other fixed-income instrument in India offers this triple tax benefit. At the 30% tax bracket, PPF's effective yield is 47% higher than a comparable FD.
What are RBI Floating Rate Savings Bonds (FRSB)?
RBI FRSB 2020 currently pays 8.05% — the highest zero-risk yield in India with no investment ceiling. The rate resets every 6 months, linked to NSC rate + 0.35%. It's 100% sovereign-guaranteed. The catch: 7-year lock-in with no premature exit (unless you're 60+), interest is fully taxable, and TDS is deducted. Best for investors who want the maximum government-backed rate without an investment cap.
What is SCSS and who is eligible?
Senior Citizens Savings Scheme (SCSS) pays 8.20% — the highest government-backed rate, paid quarterly. Max investment: ₹30 lakh. That's ₹61,500 per quarter or ₹2.46 lakh/year in guaranteed income. Investment qualifies for 80C deduction. You must be 60+ (55+ for retired defense/superannuation). Available at post offices and select banks. This should be the FIRST instrument every retiree fills before considering FDs.
Are corporate bonds on platforms like Wint Wealth safe?
Corporate bonds on platforms like GoldenPi, Wint Wealth, and Grip Invest offer 9-12% yields, but they carry real credit risk. In July 2025, TruCap Finance defaulted on NCDs sold through GoldenPi and Grip Invest — Rs 55 crore in retail exposure. Wint Wealth refused to list TruCap and has zero defaults so far. Remember DHFL and IL&FS — both were rated AA before defaulting. Rule: never put more than 5-10% of your portfolio in corporate bonds, stick to AA+ or above, and read our full platform comparison before investing.
PPF vs FD — which gives better returns?
Depends entirely on your tax bracket. PPF at 7.1% is completely tax-free (EEE). A 7.5% FD at 30% tax bracket yields only ~5.1% post-tax. PPF wins by 2% at the highest bracket. But PPF has a 15-year lock-in and ₹1.5 lakh/year limit. At the 0% bracket (no tax), FD wins because you keep the full 7.5%. The answer is: max out PPF first if you're in 20%+ bracket, then use FDs for the rest.
Why were Sovereign Gold Bonds discontinued and what should I buy instead?
The government stopped issuing SGBs because surging gold prices turned them into the most expensive borrowing instrument — liabilities crossed ₹2.2 lakh crore in FY26, exceeding even the oil bonds liability. The last tranche was issued in February 2024. For new gold allocations, Gold ETFs are the closest alternative: SEBI-regulated, 0.50-0.80% expense ratio, no GST, 12-month LTCG at 12.5%. Avoid digital gold (5-7% upfront cost, unregulated by SEBI) and jeweller schemes (1.44% IRR, forced jewellery purchase). If you hold existing SGBs, hold to maturity — capital gains are completely tax-free for original subscribers.
How can I buy government bonds (G-Secs) directly in India?
You can buy Government Securities (G-Secs) directly through RBI Retail Direct — a free online platform launched by RBI. Open an account at rbiretaildirect.org.in with your PAN and Aadhaar. You can then buy T-Bills (91/182/364 days), dated G-Secs (5-40 years), and Sovereign Gold Bonds. Minimum investment is just ₹10,000. No intermediary, no commission — you hold the bond directly in your RBI account.
How does KVP (Kisan Vikas Patra) work?
KVP doubles your money in 115 months (9 years, 7 months) at the current rate of 7.50%. Available at any post office with no maximum investment limit. No TDS is deducted — you pay tax on interest through your ITR. It's not the highest-yielding option, but the "doubling" feature makes it psychologically appealing and easy to understand. Premature withdrawal allowed after 2.5 years with a penalty.
Is NPS better than PPF for retirement?
They serve different purposes. PPF gives 7.1% guaranteed, tax-free (EEE), with zero market risk. NPS gives potentially higher returns (8-10% equity allocation) but only 60% of the corpus is tax-free at maturity — 40% must buy an annuity (taxable). PPF is better for the debt portion of your retirement. NPS is better if you want equity exposure with extra ₹50K tax deduction under 80CCD(1B). Use both — not either/or.
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