What is the current PPF interest rate?

The current PPF interest rate is 7.1% per annum (as of January 2025), compounded annually. The rate is set by the government and reviewed quarterly.

Can I withdraw PPF before 15 years?

Partial withdrawal is allowed from the 7th year onwards - up to 50% of the balance at the end of 4th year or preceding year, whichever is lower. Complete withdrawal before maturity is only allowed for medical emergencies or higher education.

Is PPF better than FD?

For long-term savings, PPF is better because: 1) Tax-free returns (FD interest is taxable), 2) Section 80C benefit up to ₹1.5 lakh, 3) Government-guaranteed safety. PPF's effective post-tax return is 7.1% vs FD's ~4.9% (for 30% tax bracket at 7% rate).

What is the minimum and maximum PPF deposit?

Minimum: ₹500 per year. Maximum: ₹1,50,000 per year. You can deposit in lump sum or up to 12 installments per year. Deposits beyond ₹1.5 lakh won't earn interest.

PPF Calculator - Public Provident Fund Interest Calculator

What is PPF (Public Provident Fund)?

PPF is a government-backed long-term savings scheme with guaranteed, tax-free returns. It's one of the safest investment options in India with the current interest rate of 7.1% per annum, compounded annually.

PPF has a 15-year lock-in period, but you can extend it in blocks of 5 years after maturity. It's ideal for building a retirement corpus or long-term wealth with zero risk.

PPF Key Features (2025)

Interest Rate	7.1% p.a. (tax-free)
Minimum Deposit	₹500 per year
Maximum Deposit	₹1,50,000 per year
Lock-in Period	15 years
Compounding	Annual
Tax Status	EEE (Exempt-Exempt-Exempt)

PPF Tax Benefits — Triple Exemption (EEE)

PPF enjoys the rare EEE (Exempt-Exempt-Exempt) status:

Investment

₹1.5L

80C Deduction

Interest

Tax on Interest

Maturity

Tax on Maturity

PPF Interest Calculation

PPF interest is calculated on the minimum balance between the 5th and the last day of each month. To maximize interest, deposit your money before the 5th of the month.

Formula: A = P × [(1+r)^n - 1] / r × (1+r)

For yearly deposits with annual compounding

Example: ₹1.5 Lakh Yearly for 15 Years

Yearly Deposit	₹1,50,000
Tenure	15 years
Interest Rate	7.1% p.a.
Total Investment	₹22,50,000
Total Interest Earned	₹18,18,209
Maturity Amount	₹40,68,209

Your ₹22.5 lakh becomes ₹40.68 lakh — 81% gain, completely tax-free!

PPF Withdrawal Rules

Partial Withdrawal (From 7th Year)

Available from the 7th financial year onwards
Maximum: 50% of balance at the end of 4th year or preceding year (whichever is lower)
One withdrawal allowed per financial year

Loan Against PPF (3rd to 6th Year)

Available from 3rd to 6th year only
Maximum: 25% of balance at the end of 2nd preceding year
Interest rate: PPF rate + 1% (currently 8.1%)
Must repay within 36 months

Premature Closure

Only allowed after 5 years for specific reasons: medical treatment (self/family), higher education (children). Interest reduced by 1% for the entire tenure.

PPF vs Other Investments

Feature	PPF	FD	ELSS
Returns	7.1% (fixed)	6.5-7%	10-15% (variable)
Lock-in	15 years	Flexible	3 years
Risk	Zero (Govt backed)	Low	High (Market linked)
Tax on Returns	Nil	As per slab	12.5% LTCG above ₹1.25L
80C Benefit	Yes (₹1.5L)	5-yr FD only	Yes (₹1.5L)

Smart PPF Strategies

1. Deposit Before 5th of April

Make your yearly deposit before April 5th to earn interest for the full year. Depositing on April 6th means you lose one month of interest.

2. Open Account for Your Child

Open a PPF account in your minor child's name. The ₹1.5 lakh limit is per account, so you can invest up to ₹3 lakh (₹1.5L each) with 80C benefit on your contribution.

3. Extend After Maturity

After 15 years, extend in 5-year blocks with or without fresh contributions. Your corpus keeps earning 7.1% tax-free — better than most FD rates.

4. Use for Retirement Planning

Start early. ₹1.5 lakh/year for 25 years (15 + two 5-year extensions) can grow to over ₹1 crore — completely tax-free retirement corpus.

How to Open PPF Account

Where: Any nationalized bank (SBI, PNB, etc.) or Post Office
Documents: PAN, Aadhaar, Address proof, Passport photo
Nomination: Mandatory — can be family member or any person
Online: Available through bank net banking (SBI YONO, etc.)

Frequently Asked Questions

Can NRIs open PPF account?

NRIs cannot open new PPF accounts. However, if you had a PPF account before becoming NRI, you can continue it till maturity (but cannot extend). Interest rate for NRI accounts is same as resident accounts.

What if I miss a year's deposit?

Minimum ₹500/year is required to keep account active. If missed, account becomes inactive. Reactivate by paying ₹500 per year missed + ₹50 penalty per year. Interest is lost for inactive years.

Can I have multiple PPF accounts?

No, only one PPF account per person is allowed. Having multiple accounts (knowingly or unknowingly) can lead to closure of extra accounts without interest.

Is PPF guaranteed by government?

Yes, PPF is backed by the Government of India — it's a sovereign guarantee. Unlike bank FDs which are insured only up to ₹5 lakh, your entire PPF balance is 100% safe.