Bank of Baroda PPF Interest Rate 2024 – Formula & Calculation

Bank of Baroda is the second-largest public sector bank in India that offers a range of investment options to citizens. One such option is a government savings scheme known as the Public Provident Fund or PPF. Investing in a Public Provident Fund with the Bank of Baroda is an excellent way to cultivate your habit of saving. 
In this guide, we will walk you through a comprehensive guide on the attractive Bank of Baroda PPF interest rate while highlighting other associated details that you need to know. 

What Is the Bank of Baroda PPF Account?

A Bank of Baroda PPF account is a savings instrument used to motivate long-term savings while offering tax benefits. It comes with a minimum lock-in period of 15 years and can be extended indefinitely in 5-year intervals.

For this account, individuals can deposit a minimum of ₹500 and a maximum of ₹1.5 lakh per financial year. The interest earned on this account is tax-free, and the invested principal amount qualifies for tax deductions under Section 80C of the Income Tax Act. 

Key Features of the Bank of Baroda Public Provident Fund Account

The following highlights some main features of the Bank of Baroda PPF account:

1. Individuals can open a PPF account for themselves or on behalf of a minor or a person of unsound mind, where they act as a guardian. However, a guardian can open only one account for a minor or a person of unsound mind.
2. Joint accounts are not allowed under this scheme.
3. The minimum deposit in a financial year is ₹500, and individuals can deposit a maximum of ₹1,50,000 in multiples of ₹50 per year.
4. Deposits can be made in a PPF account either as a lump sum or in instalments.
5. PPF accounts are transferable to or from any Bank, Branch, or Post Office.

Bank of Baroda PPF Interest Rates

The Indian government sets the Bank of Baroda PPF account interest rates, and it can change every quarter. Moreover, this interest rate is compounded annually.

How to Open a PPF Account in Bank of Baroda Online?

Here is a step-by-step guide on how to open an account online and avail the high-yielding Bank of Baroda PPF interest rate.

• Step 1: Log in to your BOB account through the app.
• Step 2: Click on the ‘Insurance & Investment’ option at the top of this page.

• Step 3: Go to the ‘Open PPF account’ section and click on it.

• Step 4: Choose your account number, and provide your personal information and other details required. 

• Step 5: Mention the amount you want to invest, with a minimum contribution of ₹500 per year.
• Step 5: Select your deposit frequency, whether it is monthly, quarterly, or yearly.
• Step 6: Confirm your transaction and complete the payment process.

How to Open a PPF Account in Bank of Baroda Offline?

The following highlights the step-by-step process of opening a PPF account in the Bank of Baroda offline. 

• Step 1: Go to your nearest Bank of Baroda branch.
• Step 2: Complete your PPF account opening form and submit the required documents like ID proof, address proof, and photos.
• Step 3: Deposit the initial amount and receive your PPF passbook.

Documents Required to Open a PPF Account in Bank of Baroda

Here are some documents you need to provide to open a Bank of Baroda PPF account:

1. Proof of identity – Aadhaar Card, Voter ID or PAN Card
2. Proof of address –  Utility Bills, Passport or Rental Agreement
3. Recent passport-sized photographs
4. BOB PPF account opening form
5. Documents of the nominee 

Additionally, minors need to provide the following documents:

1. Proof of identity for the minor – Birth Certificate, School ID or Aadhaar Card
2. Recent passport-sized photographs for both the minor and the guardian

Eligibility to Open a PPF Account in the Bank of Baroda

To avail the attractive PPF interest rate in Bank of Baroda, an applicant must satisfy the following eligibility criteria. 

1. Only Indian residents are eligible to open a PPF account. Non-resident Indians (NRIs) and Hindu Undivided Families (HUFs) cannot open a PPF account.
2. Individuals are allowed to open only one PPF account in their name at a time. 
3. Parents or legal guardians can open a PPF account on behalf of a minor.

Bank of Baroda PPF Withdrawal Rules

Here are some Bank of Baroda PPF account withdrawal rules:

1. After five years from the end of the year in which your PPF account was opened, the account holder can make a withdrawal.
2. Withdrawal is limited to 50% of the balance at the end of the fourth year preceding the withdrawal year or the preceding year, whichever is lower.
3. You must apply in a specified form for withdrawal.
4. Before withdrawing, the account holder must settle any outstanding loan amount along with interest.
5. Withdrawal can be made only once a year from accounts that have not become discontinued.

Bank of Baroda PPF Interest Rate Formula and Calculation

The interest earned from a PPF account can be determined by either using a mathematical formula or the BOB PPF interest rate calculator. Before we dive into the calculator, let’s find out more information about the formula. 

The formula for calculating BOB PPF interest and maturity value is, 

A = P [({(1+i) ^n}-1)/i]

Here, 

• A – Maturity amount
• P – Principal amount
• I – Expected rate of return
• N – Number of years

Let us now understand the formula using an example. 

Suppose you open a PPF account with an annual deposit of ₹40,000. Therefore, your total investment will amount to ₹6 lakhs over the next 15 years.

According to the formula, 

A = P [({(1+i) ^n}-1)/i = 40.000 [({(1+7.1) ^15}-1)/7.1 = ₹10,84,858

At the prevailing interest rate of 7.1% per annum, your total investment will become ₹10,84,858 by the end of 15 years while the total interest will be valued at ₹4,84,857.

How to Use a Bank of Baroda PPF Interest Rate Calculator?

To compute your Bank of Baroda PPF interest rate, use the calculator by following the below-mentioned steps:

• Step 1: Navigate to the online BOB PPF calculator.
• Step 2: Enter details such as the investment frequency and the amount you plan to invest.

Within a few seconds, the PPF calculator provides a detailed breakdown of the deposit and interest amounts. The calculator will display your maturity value, which is the amount you will receive at the end of your PPF investment tenure.

Steps to Check Bank of Baroda PPF Account Balance 

Here is a step-by-step guide on how to check your Bank of Baroda PPF account balance online. 

• Step 1: Log in to your BOB account through the app.
• Step 2: Go to ‘View All Accounts’ and then access the ‘Invest’ option.
• Step 3: Click on the ‘PPF’ option to see your account balance and transaction history.

Extension of Bank of Baroda PPF Account 

Here are some important points which you must know before extending your PPF tenure and continuing to enjoy the benefits of Bank of Baroda PPF interest rates.

1. To extend your matured PPF account, you need to duly submit Form 4 within one year from the maturity date of the original or extended PPF account.
2. There is no requirement to submit Form H for extension.
3. You can keep your PPF account active after maturity without making additional deposits and still earn interest based on the prevailing PPF interest rate.

Things to Note While Opening Bank of Baroda PPF Account

Here are some important points you should know before opening a BOB PPF account:

1. You must have a savings account with the Bank of Baroda. 
2. Joint accounts cannot be opened under this scheme.
3. The PPF account of the Bank of Baroda is backed by the Indian government of India so it is safe and secure to invest.  

How to Transfer the Bank of Baroda PPF Account? 

Here is a step-by-step process of Bank of Baroda PPF account transfer:

• Step 1: Visit the bank branch where your current PPF account is located.
• Step 2: Complete the PPF account transfer application form and submit the required documents.

The existing bank will send your application to the new bank or branch. Upon successful transfer,, you will receive a new PPF passbook from the new branch or bank.

Loan Against Bank of Baroda PPF

The Bank of Baroda PPF account provides a loan facility to its customers. Here are some points you must know before availing this loan against the Bank of Baroda PPF facility. 

1. After one year from the year of the initial subscription but before the end of five years from the same initial year, you can apply for a loan.
2. To apply, you need to obtain a specific form from the accounts office of the bank and submit it after carefully filling out all details. 
3. The loan amount cannot exceed 25% of the balance at the end of the second year just before applying for the loan.

Final Word

Now that you have an idea of the Bank of Baroda PPF interest rate account and the other details associated with it, you can easily open the account. Along with high-yielding interest, Bank of Baroda offers the convenience of both online and offline modes for depositing funds into your PPF account. 

Although a safe and attractive investment option, make sure to verify the interest rates and other associated terms and conditions of the bank before opening this account. 

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Disclaimer

This article is solely for educational purposes. Stable Money doesn't take any responsibility for the information or claims made in the blog.