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Most banks and financial institutions provide investment options that generate better returns when you invest for a longer period. However, you need to consider many factors before investing in any long-term scheme. 


For example, when planning for retirement, interest rates, tax benefits, reliability of the scheme, and other criteria play a prominent role in deciding the returns. One such investment scheme ideal for retirement planning is a public provident fund or PPF. 

What Is the Public Provident Fund

The public provident fund (PPF) is a government-backed saving scheme and it was introduced by the National Savings Institute. PPF operates via post offices and nationalised banks. For this reason, your investments in this savings scheme are not exposed to risk and earn decent returns on maturity.  


With the current PPF interest rate of 7.10% p.a., you can enjoy financial security through the returns received in your retirement years. The aim of this voluntary savings scheme is to help regular investors who can only invest small deposit amounts. 


All you need is a minimum deposit of ₹500 to open a PPF account, while the maximum amount you can invest is ₹1.5 Lakhs in a financial year. Through the power of compounding interest, your returns are generated when you deposit a fixed sum every month.

Features of a PPF Account

Here are some highlighting features of a PPF account. 

  • Available at banks and post offices 

  • Requires minimal documents 

  • Public provident fund interest rate on invested amount is fixed by the government

  • Minimum lock-in period of 15 years

  • Lump sum or systematic investments can be made 

  • Offers option to extend the tenure in a five-year block 

  • One deposit in a fiscal year is mandatory to keep the account active 

  • PPF account can have a nominee 

  • Joint accounts are not permitted 

  • Lenders offer loans against PPF accounts for 25% of the invested amount 

  • Loans can only be availed between the third and sixth year of opening the account

  • Partial withdrawal of funds is permitted from the seventh year 

Benefits of a PPF Account

Opening a PPF account offers numerous benefits. Whether you opt for small SIPs or a lump sum deposit during a financial year, you can earn secure and stable returns. 


You can open an account for yourself or on behalf of a minor in your family. During financial emergencies, you can avail loans against your PPF account from lenders.



Tax Benefit of a PPF Account

Your returns are dependent on the PPF rate fixed by the government. In addition, you can avail tax deduction under Section 80C of the I-T Act on the returns on maturity. You can claim tax deductions of up to ₹1.5 Lakhs in a financial year. Furthermore, the secure lock-in period of 15 years inculcates financial discipline in the long run. 

Eligibility to Open a PPF Account



Residential status

  • Applicant must be an Indian Resident


  • Applicant must be over the age of 18

  • For minors, the parent or guardian can open account on their behalf

Please note that you are not eligible to initiate a second PPF account if you have opened an account earlier.

Documents Required to Open a PPF Account


Documents required

Address Proof

  • Voter’s ID

  • Aadhaar Card

  • Driver’s License

  • Passport


  • Driver’s License

  • Aadhar Card

  • Voter’s ID

Other documents

  • PAN Card

  • Passport size photograph

  • Form E or nomination form

  • Form A or account opening form

How to Open a PPF Account?

You can open a PPF account by visiting your nearest post office or directly invest via the bank’s official website. 

Steps to Open for a PPF Account Online

  • Step 1: Log in to the mobile banking app or net banking portal

  • Step 2: Click the 'Open a PPF Account' tab and select the account type

  • Step 3: Fill in the application form with the required details, such as your name, address, contact number, and the deposit amount

  • Step 4: Enter the amount to deposited per month and annually 

  • Step 5: Complete the application and click submit

Simply follow these steps to quickly create your PPF account. Thereafter, you will receive a confirmation on the registered mobile number and email address with your account details. 

Steps to Apply for a PPF Account at a Post Office 

  • Step 1: Visit your nearest post office and request the PPF account form

  • Step 2: Fill out the form with the required details, such as your name, address, mobile number, and submit it with KYC documents

  • Step 3: Pay the amount required to open the account

Once your account has been created, you will receive a PPF account passbook as an account opening confirmation. 

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Loan Against PPF Account

Subscribers can also avail the loan against PPF account facility where personal loans are available against the available balance. Subscribers who are looking for unsecured short-term loans and do not want to pledge a collateral or asset can take advantage of the loan against PPF account facility at competitive rates.


The loan against PPF facility can be availed from the third to the sixth financial year after opening a PPF account. Also, only loans up to 25% of the account balance before the beginning of the third financial year can be taken.


The interest rate on the loan against PPF is charged 1% higher than the interest earned on your PPF account. Please note that, if you fail to repay the loan amount within a span of 36 months, the interest rate will be raised to 6% more than the interest earned on your PPF account balance.

Now that you are familiar with the features of a PPF account, you can easily apply for one to secure your golden years. At the same time, you can also enjoy some tax benefits. Plan your finances and decide the investment amount to generate wealth across a longer investment horizon.

FAQs on Public Provident Fund

You must maintain an active account for 15 years to earn regular interest. For every inactive year, a ₹50 penalty will be charged. Additionally, a min. of ₹500 will have to be deposited for each inactive year, along with ₹500 to activate the account. 

PPF accounts have a minimum lock-in period of 15 years. However, you can partly withdraw funds after the seventh year of opening your account.

You can apply for only one account in India, either at a bank or a post office.

You can check the PPF account balance online by logging into your net banking account. Here, you can check your details and balance.

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