Public Provident Fund (PPF) account is a government-backed, long-term savings scheme that gives tax-free returns and steady interest. PPF interest rate remains 7.1% per annum for the July to September 2026 quarter.
Ministry of Finance has kept the PPF rate unchanged at 7.1% for financial year 2026-27 so far. This rate has stayed the same since April 2020. Any citizen can open a PPF account through a post office or an authorised bank and deposit between ₹500 and ₹1,50,000 each financial year.
Public Provident Fund Account (PPF) Overview
Public Provident Fund is a small savings scheme of the Government of India with a fixed tenure of 15 years. The government notifies the interest rate every quarter. For the second quarter of FY 2026-27, the rate stands at 7.1% per annum, compounded yearly.
Interest is worked out on the lowest balance between the 5th day and the last day of every month, and it is credited at the end of the financial year. Depositing money before the 5th of a month helps earn the full monthly interest.
After maturity, the account can be extended in blocks of five years, with or without fresh deposits. Extension can be done any number of times.
PPF accounts can now be opened using Aadhaar based biometric eKYC. Paperless deposit and withdrawal through this facility has been available from 27 July 2026.
Key Information
| Detail | Information |
|---|---|
| Scheme Name | Public Provident Fund Account (PPF) |
| Nodal Ministry | Ministry of Communications |
| Nodal Department | Department of Posts |
| Interest Rate (Q2 FY 2026-27) | 7.1% per annum |
| Minimum Deposit | ₹500 per financial year |
| Maximum Deposit | ₹1,50,000 per financial year |
| Tenure | 15 years |
| Tax Benefit | Deduction under Section 123 of Income Tax Act, 2025 |
| Loan Facility | Available from 3rd to 6th financial year |
Benefits
PPF gives several money and tax advantages to account holders. Main benefits are listed below.
- Tax-free interest: Interest earned each year is fully exempt from income tax. The scheme has EEE status, so the invested amount, interest and maturity amount are all tax-free.
- Tax deduction on deposits: Deposits qualify for deduction up to ₹1,50,000 under Section 123 of the Income Tax Act, 2025, which earlier came under Section 80C.
- Flexible deposits: A person can pay a minimum of ₹500 and a maximum of ₹1,50,000 in a financial year, in one go or in up to 12 installments.
- Loan facility: A loan can be taken from the 3rd to the 6th financial year, up to 25% of the balance at the end of the second preceding year. Loan interest is 1% above the PPF rate, and repayment must finish within 36 months.
Eligibility
Opening a PPF account needs the following conditions.
- Applicant must be a resident Indian.
- A parent or guardian can open one account for a minor or for a person of unsound mind.
- Joint accounts are not allowed. A person can hold only one PPF account in their own name.
Application Process
PPF account can be opened online through a bank or offline through a bank or post office. Both ways are given below.
Online Application
STEP 1 - Log in to your bank's internet banking or mobile banking app.
STEP 2 - Select the option to open a PPF account.
STEP 3 - Choose self account or minor account and fill the application form with the required details.
STEP 4 - Enter the deposit amount for the financial year and submit the form. Enter the OTP sent to your registered mobile number.
STEP 5 - The account gets created and the PPF account number is shown on screen.
Offline Application at Post Office
STEP 1 - Visit the nearest post office and ask for the PPF account opening form and KYC form.
STEP 2 - Fill the forms and attach the required documents such as PAN, Aadhaar and photographs.
STEP 3 - Submit the completed forms at the post office counter.
STEP 4 - Make the first deposit of at least ₹500.
STEP 5 - After checking the documents, the account is opened and a passbook is given.
Documents
These documents are required while opening a PPF account.
- Identity proof: Aadhaar, PAN, Voter ID, driving licence or passport.
- Address proof: Aadhaar, electricity bill or bank statement.
- Recent passport-size photographs.
- Nominee declaration form and the first deposit instrument.
Withdrawal and Maturity
Full withdrawal is allowed only after the account completes 15 years. Partial withdrawal of up to 50% of the balance at the end of the fourth preceding year is allowed after the fifth financial year.
Premature closure is allowed only in specific cases such as serious illness or higher education, subject to the scheme rules.
References
Official sources for PPF details are given below.
NSI Public Provident Fund Account
FAQ's
What is the current PPF interest rate?
PPF interest rate is 7.1% per annum for the July to September 2026 quarter. It has stayed unchanged since April 2020.
Who can open a PPF account?
Any resident Indian can open a PPF account. A guardian can open one for a minor or a person of unsound mind.
Are joint accounts allowed?
No, joint accounts are not allowed. Only individual accounts are permitted under the PPF scheme.
What are the deposit limits?
Minimum deposit is ₹500 and maximum is ₹1,50,000 in a financial year across all accounts held by a person.
Is PPF interest taxable?
No, interest earned is fully exempt from tax. The scheme has EEE status.
When can a loan be taken against PPF?
A loan can be taken from the 3rd to the 6th financial year, up to 25% of the eligible balance, and must be repaid within 36 months.
When is full withdrawal allowed?
Full withdrawal is allowed only after the account completes 15 years. Partial withdrawal is allowed after the fifth year under the scheme rules.
