Public Provident Fund (PPF): Overview

If you haven't already started on a long-term savings strategy, you could begin with a Public Provident Fund (PPF) subscription . A government-guaranteed fixed income security, this is very apt as a long-term savings instrument. Yearly subscriptions can be as low as Rs. 500 to as high as Rs. 1,00,000.

It counts being among the most secure investments you can have in this country. The interest earned on the PPF subscription is compounded; that means you not only earn interest in the money you put in, but you earn interest on the interest earned too. All the balance that accumulates over time is exempt from wealth tax.

A flip side, its an extremely illiquid investment instrument. Its lengthy lock-in period works out to 16 years since the last contribution is made in the 16th financial year. In all, the PPF is a very good savings instrument, and you should consider investing in it.

PPF: Basics

Who can open a PPF account?

Any individual can open a PPF account, either for himself/herself or on behalf of a minor. ......

Where can I open a PPF account?

You can open a PPF account at any branch of the State Bank of India, its associated banks or with some other nationalized banks or head post office, selected grade post offices, or a GPO. ......

Can an individual have more than one PPF account?

No, an individual cannot have two PPF accounts in their name at the same time. ......

Can an Non Resident Indian (NRI) open a Public Provident Fund (PPF) account?

NRI cannot open a PPF account ......

What is the process of PPF account transfer from a bank to a post office?

Read to know the process of PPF account transfer from a bank to a post office ......

PPF: Did you Know

Do I have to contribute every year to my PPF account?

Yes. Your account will be defunct if you do not deposit the required minimum of Rs. 500 a year. ......

What happens to a PPF account in event of the depositor's death? If a PPF account holder dies and there is no nomination, who gets the deposited amount?

If the amount is up to Rs. 1 lakh, the accounts office will pay it to the legal heirs of the deceased on receipt of application in prescribed form. ......

For how many years can a PPF account be extended beyond its initial 15 years of operation?

After the PPF account has been in operation for 15 years, it can be extended for five years at a time. ......

Can a PPF account be transferred from one branch of a bank to another branch, or one post office to another post office? What is the process?

Yes, a PPF account can be transferred from one branch of a bank to another branch, or from one post office to another. ......