PPF, Public Provident Fund

About PPF : Public Provident Fund (PPF) scheme is a popular long term investment option backed by Government of India which offers safety with attractive interest rate and returns that are fully exempted from Tax. Investors can get the facilities such as loan, withdrawal and extension of account.

Public provident fund

Where to open ppf account : A PPF account can be opened in any post office or designated bank branches of State Bank Of India(SBI), Union Bank Of India(UBI),  ICICI Bank, Axis Bank,  HDFC Bank, Central Bank of India, Bank of India (BOI), IDBI, Central Bank of India, Punjab National Bank, Indian Overseas Bank etc. Some private or designated bank  customer’s provide facility to open online PPF account.

Document required for PPF account :

  • Offline process : Duly filled registration form, proof of identity,  proof of residence of India and a couple of photograph.
  • Online process : Account in Mentioned Bank list, aadhar card, pan card and cancel cheque.

Investment Limit : The minimum investment of  RS. 500 and maximum of RS. 1.5 Lakh per financial year is permitted.

Tenure or Lock in period : Your money is blocked for 15 years.

Withdrawals : Partial withdrawal are permitted after completing of 5 financial year from the end of first year of subscription.

Tax benefits : PPF enjoys the E-E-E status i.e. tax exemption on investment interest and maturity under section 80(C).

Rate of interest : Currently the PPF interest is set at   7.1% for April 2020 to June 2020. The PPF interest rate is set every year by the ministry of finance.

Loan against PPF : You can avail for a loan from the completing 2nd year of opening the PPF account to the end of 6th year (Between starting of 3rd year to  end of 6th year).

Maturity : You can either close the A/C; extend with fresh contribution; or extend without any contribution and earn interest on total maturity amount.