The Public Provident Fund (PPF) is one of India’s most trusted long-term savings options.
It is especially popular among salaried individuals looking to secure their financial future and retirement.
Even though the interest rate has remained steady, PPF continues to attract investors because it is safe, offers tax-free returns, and guarantees growth through compounding.
At the current rate of 7.1%, if you deposit the maximum of Rs 1.5 lakh per year, your PPF account could grow to Rs 40.68 lakh in 15 years.
Out of this, over Rs 18 lakh comes purely from tax-free interest.
How PPF Works and Its Benefits
PPF is backed by the Government of India, which means your investment is secure.
The scheme offers guaranteed returns and follows the EEE (Exempt-Exempt-Exempt) tax structure, making it a highly tax-efficient option.
Key Features:
Interest rate: 7.1% per annum (compounded annually)
Minimum deposit: Rs 500 per year
Maximum deposit: Rs 1.5 lakh per year
Account can be opened in your name or in the name of a minor child
Investors can deposit either in one installment or multiple installments throughout the year.
Over time, the power of compounding ensures your money grows steadily.
Example of PPF Growth:
Deposit per year: Rs 1.5 lakh
Total investment over 15 years: Rs 22.5 lakh
Maturity amount after 15 years: Rs 40,68,209
Total interest earned: Rs 18,18,209
How to Open a PPF Account
Opening a PPF account is simple and can be done offline at a bank or post office or online.
Documents Required:
KYC documents (Aadhaar, Voter ID, or Driving License)
PAN card
Address proof
Nominee declaration form
Passport-size photograph
Once the account is opened, you can start investing and enjoy tax-free interest along with long-term financial security.
