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There are three major government-backed retirement schemes in India: Public Provident Fund (PPF), Employees’ Provident Fund (EPF), and Voluntary Provident Fund (VPF). Out of these, the first two are more popular investment avenues for salaried employees. 


While the net deposits in PPF have increased by almost 134% in the past decade, the adoption of EPF has also increased. The latter is indicative of the fact that EPFO has been adding over 14 Lakh net subscribers every month since November 2022. 


However, both these schemes operate differently in all major aspects, including interest rates, taxation, and withdrawal guidelines. So, read on to know more about the difference between EPF and PPF and which one would be better for you to invest in.

PPF vs EPF: A Detailed Comparison

The following table provides a detailed account of the difference between EPF and PPF:

PPF vs EPF: A Detailed Comparison




Account Type

It is a savings-cum-retirement account

It is savings-cum-investment account


The main purpose of EPF is to build a retirement corpus

The primary purpose of this type of account is to save to cover expenses for long-term financial goals

Interest Rate

8.15% (for FY22-23)

7.1% (for the April to June quarter of 2023)


Until retirement

15 years

Minimum Investment Required

Employees need to contribute 12% of their basic salary



All salaried employees of the companies having a workforce of more than 20 employees

The investor must be an Indian resident


12% of an employee’s basic salary + Equal contribution from the employer’s side

Any amount between ₹500 to ₹1.5 Lakhs in a financial year

Withdrawal Rules

Complete withdrawal can be made after the lock-in period

Partial withdrawal is allowed only after 5 years of investment under special circumstances

75% of the corpus can be withdrawn during unemployment 

Rest 25% can be withdrawn after 2 months of being unemployed

Complete withdrawal can only be made after retirement

Partial withdrawals can be made under certain conditions


Contributions made towards the scheme qualify for Tax deductions under Section 80C + Amount received at maturity is tax-free

Contributions made towards the scheme qualify for Tax deductions under Section 80C + Amount withdrawn after 5 years of investment is tax-free

Scheme Offered By

Employees’ Provident Fund Organisation (EPFO)

All major PSBs and the Indian Post Offices


Which One is Better: PPF or EPF?

It is important to understand both these schemes closely. PPF is an investment-cum-savings scheme that allows you to earn stable returns to fulfil your long-term financial goals.


PPF comes with a lock-in period of 15 years, which can be extended after maturity in the blocks of 5-year periods. 


On the other hand, the EPF scheme allows employees to build a retirement corpus. Under the scheme, the employees need to contribute 12% of their basic salary. The employer makes a similar contribution toward the PPF account. 


As per the rules, all companies with a workforce of more than 20 employees are mandatorily required to opt for the EPF scheme.


The choice between PPF vs EPF depends on your financial goals and state of employment. For instance, if you are employed in a company having more than 20 workers, you will mandatorily have an EPF account.


Moreover, as the main purpose of EPF investment is to build a retirement corpus, this would be a better choice of investment if you are planning for your retirement. In addition, the PPF scheme comes with flexibility in terms of contribution. You can make contributions of any amount and whenever you want, a facility not available with EPF accounts.


However, when investing in the PPF scheme, note that this investment option has a strict lock-in as you can make a complete withdrawal only after 15 years of investment. 


To conclude, all three major provident fund schemes are one of the best investment tools for those salaried employees who are looking for risk-averse options. Because they carry a sovereign guarantee, these PF schemes offer stable and assured returns along with tax benefits. 


However, as each of these schemes comes with its own set of pros and cons, it is pertinent to research PPF vs EPF before investing. To make an informed choice, you compare returns provided by these schemes. Use the PPF Interest Calculator on Bajaj Markets to determine how much interest you stand to earn, along with the total amount receivable at maturity.


The information provided by BFDL herein above is related to the Non-Partnered Banks/ NBFCs and is just for the purpose of information and under no circumstances the information provided hereinabove is intended to be source of advice or recommending any financial investment advice or endorsement of any sort. 

The information including interest rates with regard to fixed deposit, provided on this website is gathered through publicly available sources over the internet and is considered as accurate and reliable to the best of our knowledge. BFDL disclaims any responsibility or liability regarding inaccuracies, omissions, mistakes etc. as well as offers by the Non-Partnered Banks. The use of information set out is entirely at the User’s own risk and User should exercise due care prior taking of any decision, on the basis of information mentioned hereinabove. You are advised to visit/ contact the respective Banks/ NBFCs to verify the information before making any investment or opening an account. Further, BFDL does not undertake any responsibility or liability to update this information. YOU ARE SOLELY RESPONSIBLE FOR ANY LIABILITY OR DAMAGE YOU INCUR THROUGH ACCESS TO OR USE OF THE SITE OR SUCH INFORMATION OR MATERIALS EXCEPT WHERE THE LAWS AND REGULATIONS OF A PARTICULAR JURISDICTION CONCERNING WARRANTIES CANNOT BE WAIVED. Additionally, display of any trademarks, tradenames, logo and other subject matters of intellectual property owners. Display of such Intellectual Property along with the related product information does not imply BFDL’s partnership with the owner of the Intellectual Property of such products. 

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FAQs on the Difference Between PPF and EPF

While you can open a PPF account for minors under their parent’s or guardian’s guidance, an EPF account can only be opened by the employers of salaried individuals.

The PPF vs EPF maturity period differs widely as PPF comes with a lock-in period of 15 years. On the other hand, an EPF account matures only after an employee’s retirement.

VPF vs EPF vs PPF interest rates vary and are fixed by the Government of India. The rate of interest offered by VPF is 8.5% for this financial year compared to 8.15% for EPF investments. On the other hand, the interest rate for PPF has been pegged at 7.1%.

No, you can not withdraw money from your PPF account until it completes five years of investment. After 5 years, you are allowed to make a partial withdrawal, amounting to 50% of the corpus, which is subject to certain conditions.

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