Post Office PPF Scheme – Postal PPF Interest Rates 2024

Public Provident Fund (PPF) is an investment plan that offers a stable and high-yielding rate of interest. You can invest in the PPF from any bank or India Post branch. Being one of the oldest and most reliable government institutions, the Post Office offers PPF schemes, widely known as one of the popular choices for this long-term savings plan. Plus, it comes with attractive features like secured returns, ease of opening an account, etc. 

In this blog, we will walk you through a detailed guide on features and benefits associated with opening a PPF at post office in India. 

What is the Post Office PPF Account? 

Post Office PPF is an institutional savings plan, initiated according to the guidelines stated in the PPF Scheme 2019. It enables investors to grow their funds for the future by depositing on a routine basis. Moreover, it offers tax benefits upon making yearly contributions to the PPF account under Section 80C of the Income Tax Act of India.

Key Features of Post Office Public Provident Fund Account

Here are the basic features of the Post Office Public Provident Fund:

1. In a financial year, you can deposit a minimum amount of ₹500 and a maximum amount of ₹1,50,000.
2. You can make subsequent lump sum deposits in multiples of ₹100.
3. India Post offers no limitations on how many deposits you make in a particular financial year.
4. If you miss a deposit of at least ₹500 in a financial year, the India Post will discontinue your Post Office PPF account.
5. You can revive your discontinued PPF at the Post Office by paying a nominal fine of ₹50 along with the deposit amount for that particular financial year.
6. As a legal or natural guardian, you can open a PPF account on behalf of minors and mentally unsound persons.
7. You will be able to get the benefit of a tax rebate on your PPF deposits as per Section 80 C of the Income Tax Act of India.
8.  The interest earned on your Post Office PPF will be tax-free.

Post Office PPF Interest Rates 2024

The interest rate of the Post Office PPF Scheme is subject to quarterly changes as decided by the Ministry of Finance. Below is the prevailing interest of Post Office PPF:

There are a few aspects of the interest rate you should keep in mind:

1. The monthly interest accumulation will be on the lowest PPF account balance between the period of the 5th and the last day of the month.
2. You will get the interest earnings on your PPF account after the completion of every financial year.

How to Open a PPF Account in Post Office Online? 

To open your Post Office PPF account online, you must activate your DOP Internet Banking Facility. Here are the steps to open the PPF at Post Office online from the internet banking portal of India Post:

• Step 1: Go to the Internet Banking Portal of India Post and log in to your user account.
• Step 2: Click on ‘Service Request’.
• Step 3: Select ‘New Request’ and proceed to the next page by clicking on ‘OK’.
• Step 4: Select your request type as ‘PPF Accounts – Open PPF Account’.
• Step 5: Enter the deposit amount (minimum ₹500) and select your debit account.
• Step 6: Complete the transaction of your deposit amount.
• Step 7: Submit your online application form for Post Office PPF.

Upon completion of these steps, you will successfully open your PPF account and the details of PPF will be available on the account section of the India Post Internet banking dashboard.

How to Open a PPF Account in Post Office Offline? 

You can open the Post Office PPF account offline by following these simple steps:

• Step 1: Visit your nearby post office branch.
• Step 2: Collect the application form for the Post Office PPF.
• Step 3: Fill in the application form.
• Step 4: Attach all the required documents with the form and submit it. 
• Step 5: Pay the amount you want to deposit in your PPF Account (must be at least ₹500).

After these steps, the India Post will verify your documents and account opening form and complete all the formalities for opening the PPF account. Once the account is opened, you will get a passbook for the India Post PPF account.

Documents Required to Open a PPF Account in the Post Office

You will have to submit the following documents with the application form for investing in PPF at Post Office:

1. PAN card
2. Aadhaar Card
3. Duly filled in the KYC form
4. Proof of your date of birth

If you do not have an Aadhaar card, you will have to submit the following document:

1. Passport 
2.  Voter ID card
3. Driving License
4. Job card
5. Letter issued by the National Population Register containing your name and residential details

Eligibility to Open a PPF Account in the Post Office 

The following are the eligibility parameters for investing in the Post Office PPF plan:

1. An applicant must be a resident of India, above 18 years of age.
2. Guardian can open a PPF account at the India Post Office for a minor or mentally unsound individual.

Post Office PPF Withdrawal Rules

You will have to make sure that you meet the following criteria to withdraw the Post Office PPF balance from your account:

1. You are allowed to withdraw an amount after 5 years of opening the account, excluding the financial year in which you started the account. For example, if you open your Post Office PPF account in the financial year 2015-16, you can withdraw your balance in the financial year 2021-22.
2. You can withdraw an amount from the PPF account once in a financial year.
3. The withdrawal amount will be up to 50% of the PPF account balance after the preceding financial year or after the 4th preceding financial year, whichever of them is the lowest. 

Here is an example showcasing the maximum amount you can withdraw:

Let’s assume that you want to withdraw some amount from your PPF account in 2023-24 and the balance in your account at the end of FY 2022-23 is ₹5,00,000 and at the end of FY 2019-20 is ₹4,00,000. In such a circumstance, the amount you can withdraw is up to 50% of ₹4,00,000 or ₹2,00,000.

Post Office PPF Formula and Calculation

The interest on your PPF balance gets credited to your account after the end of a financial year. Here is the formula according to which the interest accumulates every year on the PPF balance: A= P [({(1+i)^n}-1)/i]

Here, ‘A’ refers to the maturity value of your PPF balance, ‘P’ denotes the amount you deposit, ‘i’ indicates the rate of interest on the PPF balance and ‘n’ refers to the number of years you will stay invested.

Let us understand this mathematical formula with the help of an example. 

Suppose you want to make a yearly contribution of ₹40,000 to the Post Office PPF scheme for 15 years. 

In this case, A= P [({(1+i)^n}-1)/i] = 40,000 [({(1+7.1)^15}-1)/7.1] = ₹10,84,856.

How to Use a Post Office PPF Calculator? 

India Post does not offer a PPF calculator on its portal. However, there are some online platforms from which you can access a PPF Calculator.

Here are the steps you will have to follow to calculate the maturity amount of your PPF:

• Step 1: Enter the total investment amount.
• Step 2: Mention the time period for investment.

After this, you will be able to check the total interest and maturity value of your PPF investment.

Steps to Check Post Office PPF Balance 

Here are the steps you will have to follow to check the Post Office PPF Balance through the India Post Mobile Banking app:

• Step 1: Install the India Post Mobile Banking app and log in to it using your User ID and MPIN.
• Step 2: Go to the ‘Accounts’ section.
• Step 3: Tap on ‘PPF Accounts’.

After this, you will get to see your Post Office PPF account balance.

Alternatively, you can check the PPF account balance from the official portal of India Post. For this, you will have to follow the steps mentioned below:

• Step 1: Open the official portal of India Post.
• Step 2: Click on ‘Banking and Remittance’ from the menu.
• Step 3: Click on ‘ePassbook’.
• After this, you will be redirected to the DOP Product Payment portal of IPPB.
• Step 4: Access the ‘POSB SEVA – ePassbook’ section.
• Step 5: Log in to the portal using your credentials.
• Step 6: Click on ‘POSB SEWA – ePassbook’.
• Step 7: Select the scheme type and provide your account number and the registered mobile number.
• Step 8: Enter Captcha.
• Step 9: Click on ‘Balance Enquiry’.

After this, you will be able to check the balance of your Post Office PPF scheme.

How to Download Post Office PPF Account Statement? 

You can download your account statement of PPF at Post Office online by following the steps mentioned below:

• Step 1: Open the India Post official portal.
• Step 2: Select the option ‘Banking and Remittance’. 
• Step 3: Click on ‘ePassbook’.
• After this, you will be redirected to the IPPB portal.
• Step 4: Click on ‘POSB SEWA – ePassbook’.
• Step 5: Log in to the portal.
• Step 6: Click on ‘POSB SEWA – ePassbook’. 
• Step 7: Select the scheme and enter your account number and the registered mobile number.
• Step 8: Enter the Captcha. 
• Step 9: Select ‘Mini Statement’.

After this, you will get your Post Office PPF account statement.

Extension of Post Office PPF Account 

Here is how you can extend your Post Office PPF account:

• Step 1: Visit the nearby India Post branch and request the application form for the extension of your PPF account.
• Alternatively, you can download the PPF account extension form from the official website of India Post.
• Step 2: Fill in the form with all the requested details and enter the period of extension.
• Step 3: Submit your duly filled-in application form.

Things to Note While Opening Post Office PPF Account

There are some facts you should ideally keep in mind while opening the Post Office PPF account:

1. You can open only one account in your name across all the branches of India Post or any other bank.
2. The maximum yearly investment amount of ₹1,50,000 is inclusive of the deposits you made in your account and the account of a minor as a guardian.
3. The PPF account matures after 15 financial years, excluding the financial year of opening the account.
4. The extension of the PPF account after the maturity should be in a 5-year block.

Loan Against Post Office PPF

You can take a loan against the Post Office PPF balance. Here are the conditions to get this loan:

1. You will be eligible for the loan against the PPF balance after completing 1 year since the financial year in which you have opened the account. For example, if you open your account in FY 2023-24, you can apply for the credit in FY 2025-26.
2. The last date for applying for the loan against the PPF balance will be the end of the five years, starting from the date of the initial deposit.
3. You can borrow only once in a financial year.
4. It will not be possible for you to get the second loan till you repay the 1st loan.
5. The applicable rate of interest on the loan against the Post Office PPF will be 1% p.a., if you repay within 36 months. If you take more than 36 months to repay, the applicable interest rate will be 6%.
6. The maximum loan amount will be 25% of the outstanding balance at the end of the 2nd preceding financial year. For example, if your outstanding PPF balance at the end of the FY 2023-24 is ₹4,00,000, you can borrow up to ₹1,00,000 in the FY 2025-26.

Final Word

PPF at Post office is a secure investment to grow money for your future with a stable interest. Plus, it lets you enjoy a tax deduction under Section 80C of the Income Tax Act of India. Being backed by the government itself, you get an extra cushion of security on your investment. 

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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.