Public Provident Fund

Features

• PPF account can be in office or branch of all public sector banks and ICICI Bank, Axis Bank and HDFC Bank Ltd.  and any other office authorized by the Central Government to receive subscriptions under the Scheme.
• Investment Limits A minimum of Rs.500.00 subject to a maximum of Rs.1,50,000 per annum may be deposited.
• Original duration is 15 years. Thereafter, on application by the subscriber, it can be extended for 1 or more blocks of 5 years each.
• The rate of interest is determined by Central Govt. on quarterly basis. At present it is 7.90% per annum with effect from 01.10.2019.
• Loans and withdrawals are permitted depending upon the age of the account and balances as on the specified dates.
• Loan facility is available from 3rd financial year up to 6th financial year.
• One withdrawal is permissible every year from 7th financial year.
• Deposit may be PPF account qualified for deduction under Sec- 80 C of Income Tax Act.
• Nomination facility is available in the name of one or more persons. The shares of nominees may also be defined by the subscriber.
• The account can be transferred to other branches/ other banks or Post Offices and vice versa upon request by the subscriber. The service is free of charges.
• The amount in the PPF account is not subject to attachment under any order or decree of a court of law.

Eligibility

• Individuals in their own name as well as on behalf of a minor or a person of unsound mind can open the account at any Branch.
• Non-resident Indians (NRIs) are not eligible to open an account under the Public Provident Fund Scheme. However, a resident who becomes an NRI during the 15 years' tenure prescribed under Public Provident Fund Scheme may continue to subscribe to the fund until its maturity on a non-repatriation basis.
• An individual can open only one PPF account and declare the same at the time of account opening.
• No joint PPF accounts are allowed.

Terms & Conditions

• The subscriber should not deposit more than Rs.1,50,000 per annum as the excess amount will neither earn any interest nor will be eligible for rebate under Income Tax Act. The amount can be deposited in lump sum or in installments.
• Interest is calculated on the minimum balance( in PPF Account) between 5th day and end of the month and is paid on 31st March every year.
• Interest income is totally exempt from Income Tax. Amount outstanding to the credit is fully exempted from Wealth Tax also.
• An account holder shall be allowed premature closure of his account or the account of a minor or person of unsound mind of whom is the guardian on an application to the accounts office in Form-5, on any of the following grounds, namely.