The government has decided to lower interest rates on its general provident fund and special deposit schemes by 100 basis points, a senior finance ministry official said on Wednesday.

"In both the schemes it will be a 100 basis points reduction. It will be effective from April 1," the official, who did not want to be identified, told Reuters.

The interest rates were cut from 9.0 per cent after the government reduced rates on some small savings schemes by 100 basis points in the Union Budget last month.

The special deposit scheme, in which funds collected by the Employees Provident Fund, India's largest state-run pension fund, are invested, has a corpus of more than Rs 90,000 crore (Rs 900 billion).