PPF- How good an investment option!!
By Neelima Shankar
Print    Email    RSS   

As the financial year end approaches, people generally look for a safe investment option that gives them tax benefits and decent returns. Public provident fund commonly known as PPF has been one of the oldest and highly preferred investment options as it is one of the very few investment options that fall under EEE (exempt-exempt-exempt) tax regime. This means that not only the investor can enjoy deduction on the amount invested in PPF but the interest received on maturity is also exempted from tax.

Apart from such benefits PPF also serves as a retirement-planning tool for investors who do not have any structured pension plan covering them.

What is PPF?

PPF is a long term investment scheme floated by the Government. PPF has been introduced both for salaried and self employed people to encourage savings habit and provide tax benefits to them.

Investors can invest minimum of Rs. 500 to maximum of Rs. 1, 00,000 in the PPF account in the financial year. It can be given either in one lump sum or in maximum of 12 transactions per year. One transaction every year is however compulsory for PPF. The lock-in period of PPF scheme is 15 years and premature closure of account is not allowed at any point of time.

After 15 years investor can completely withdraw the accumulated balance (Principal + Interest) and close the PPF account. But, if investor desires to extend his PPF account, extension can be made for next 5 years. As per PPF scheme terms and conditions prescribed by Central Government, an investor can avail loan.

How to open a PPF account?

PPF account can be opened in any Post Office and some authorized Banks such as State Bank of India, ICICI Bank. Most people prefer a Bank since it is easier to set up the Bank account with online deposits and/or authorizing remittances for the account.

What are the tax benefits?

Public Provident Fund scheme is the best option in terms of benefits offered as compared to other investment options. Interest earned in PPF is fully exempt from tax without any limit. Annual contributions of PPF qualify for tax rebate under Section 80C of Income tax Act. Contributions to PPF accounts of the spouse and children are also eligible for tax deduction.
Balance in PPF account is not subjected to attachment under any order or decree of court. But, Income Tax authorities can attach the PPF account for recovering tax dues.

What are the interest rates?

The PPF interest rate has steadily dropped over the years, and can be expected to slowly fall further as the years proceed. Though there has been an upswing in the PPF interest rate over last 2 years.

PPF interest rate as on 01 April 2013 is 8.70% which is lower as compared to last year's interest rate of 8.80%.


(Comments Posted : 8) Post Your Comments
1. payday personal loan
online loans
payday loans no credit check
payday loans direct lenders
Forest (Posted: Jan 1, 2018)
2. Do you need a Loan?
Are you looking for Finance?
Are you looking for a Loan to enlarge your business?
I think you have come to the right place.
We offer Loans at low interest rate.
Interested people should please contact us on
For immediate response to your application, Kindly
reply to this emails below only:
call or add us on what's app +1 323-406-1670
Mustapha Mahmood (Posted: Nov 7, 2016)
3. Welcome to Thomas Credit Firm, I am an international business man and Lender that has offered Loans to so various individual and firms in Europe, Asia, Africa and other parts of the world. We give out our Loan for a interest rate of 2% per annul for a minimum of 100.00 to a maximum of 100,000,000.00 rubles, dollars, pounds, euros, etc. The maximum loan term we can offer is 30 Years at fixed interest rate.
Available Loans
* Personal Loans (Secure and Unsecured)
* Business Loans (Secure and Unsecured)
* Combination Loan (Secure and unsecured)
* Consolidation Loan (Secure and unsecured)
* Mortgage Loans (Secure and unsecured)

Interested candidates should please contact us today for your online quick and easy loan without collateral deposits. Email:

Thomas Dawson (Posted: Jul 9, 2015)
Show All Comments
 Select a product:

 Select a product:

Carnival of Indian Personal Finance Blogs #6
Credit profile and its effect on loan...
Savings account portability: How...
Carnival of Indian Personal Finance Blogs #4
Personal Finance for the 21st century...

how to download my account details
last six months statement

HDFC bank adjudged as the Best private bank in India Feb 16, 2015
HDFC reported an increase of 20% in its net profit Feb 16, 2015
ICICI bank launched Flash remit facility Feb 13, 2015
BOM launched new savings deposit scheme for HNI customers Feb 12, 2015
BMB bank to have a total of 80 branches by the March end. Feb 10, 2015
News Archive