What is PPF or Public Provident Account and What are it’s Benefits?

The students who has just passed out of their college and joined the corporate world and earning lots of money,after sometime they start to make plan how to get great returns of their money and where to invest so they start to investigate the best ways to invest their hard earned money.At one point in time or the other we would have come across ‘PPF” or ‘Public Provident Fund’ as an effective investing instrument.There are lots of other offerings available in the market one of them is the PPF or Public Provident Fund so here we will help people to know more about PPF and it’s benefit.

So, the first question always arises in our minds that:

What is PPF?

The PPF or Public Provident Fund has been established by the central government. Any individual can open PPF account be it a salaried person, business man, consultant,  freelancer or even working in contractual basis. NRI’s are not allowed to open PPF account but while he is a residnet of India and subsequently become NRI then the individual can continue PPF account.

PPF is a Long Term Debt Scheme of the Central Government of India on which regular interest is paid. PPF account can be opened in any of the Post Offices, any branch of State Bank of India and some branches of nationalised banks.

Benefit’s of PPF Account?

Currently, the interest rate offered through PPF is around 8.6 per cent, which is compounded annually, which is decided by Govt.
1) Benefit u/s 80c – Investments made in PPF account are eligible for deduction u/s 80c
2) Tax Free Interest – No tax is payable in the interest earned on PPF account

Interest is calculated on the lowest balance between the fifth day and last day of the calendar month and is credited to the account on March 31 every year. So to derive the maximum, the deposits should be made between 1st and 5th day of the month.

Maximum & Minimum an Individual can deposit in PPF Account?

The maximum amount an individual can invest per year in PPF is Rs 1,00,000/- and the minimum amount an individual can invest per year is Rs 500/-

Duration of Investment in PPF?

The duration of the investment is 15 years from the date when the account is opened after 5 years the whole amount can be withdrawn and if someone wants to extend the PPF account, the account holder can also also apply for extension for further 5 years.

Other Faqs about PPF ?

1) Pre-Mature withdrawal for PPF – Yes, it can be done but after the end of the 5th year and the maximum amount an individual can withdraw in pre mature stage is 50% of amount which stood in his/her account

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Sanjeeb was born with six toes on each foot. The extra toes were removed before he was a year old, robbing him of any super-powers and ending his crime fighting careers before it even began. Unable to battle the forces of evil, he instead work as a professional in Digital Marketing arena, currently living in Kolkata, India. Founded sanjeebpanda.com with the purpose to share his experience and interesting tech news. Connect with him on