PPF Accounts

INTEREST

Interest Rate is declared by GOI from time to time. Present ROI is 7.10% Per Annum

• Interest shall be credited to the account at the end of each financial year.
• Interest for a calendar month is calculated on the basis of credit balance as on the fifth day and the end of the month, whichever is lower.

TAX BENEFIT

PPF is an investment which comes under the EEE (Exempt-Exempt-Exempt) category-

• The investments upto Rs 1.5 Lacs made in the Public Provident Fund are tax deductible U/s 80C of the Income Tax Act.
• The interest accrued is exempt from tax implications.
• The accumulated amount at maturity is completely tax free.

OTHER IMPORTANT FEATURES

PPF comes with an assortment of other benefits :-

• Loan Facility: The facility of loan against the PPF deposits is available from 3rd to 5th year of deposit to the extent of 25 % of the amount deposited at the end of the last financial year. The loan is repayable in 36 months.
• After Maturity: The account holder can retain the account after maturity for any period without making any further deposits. The balance in the account will continue to earn interest at normal rate as admissible on PPF account till the account is closed.
• Transferability : Account is fully transferable among branches, banks and post office.
• Court Attachment: PPF deposits cannot be attached by any Court.

ELIGIBILITY

• Resident Indian individuals can open their PPF account.
• Guardians can open the A/c on behalf of minor child / person of unsound .
• NRI and HUF are NOT eligible to open PPF A/c.

INVESTMENT AMOUNT

• The minimum deposit is Rs. 500/- while maximum deposit is Rs. 1,50,000/- in a financial year.
• The deposit can be made either in lump sum or in installments.
• The deposits shall be in multiples of Rs.100/- subject to minimum amount of Rs.500/- in one financial year.
• The discontinued account can be activated by payment of minimum deposit of Rs. 500/- with penalty of Rs.50/- for each defaulted FY.
• The deposit in a minor account is clubbed with the deposit of the account of the Guardian for the limit of Rs.1,50,000/- U/S 80C

MODE OF INVESTMENT

• Contribution can be made through all BOI Branches and BOI Internet Banking
• Statement generation facility is available through BOI Internet Banking and BOI Branches
• Facility of Auto deposit into account by Standing instruction is now available

NOMINATION

• Nomination is mandatory.
• Maximum number of nominees in PPF account are now 4.

PERIOD

• The duration of account is 15 years, which can subsequently be extended for 5 years at a stretch for any number of time

Note: Discontinued account may be revived during its operating period on payment of a penalty of Rs. 50/- along with arrears of deposit of Rs. 500/- for each year of default.

PREMATURE CLOSURE

An account holder shall be allowed premature closure of his/her account or the account of a minor/person of unsound mind of whom he/she is the guardian on an application to the Bank in Form-5, on any of the following grounds, namely:-

• Treatment of life threatening disease of the account holder, his/her spouse or dependent children or parents, on production of supporting documents and medical reports confirming such disease from treating medical authority.
• Higher education of the account holder, or dependent children on production of documents and fee bills in confirmation of admission in a recognized institute of higher education in India or abroad.
• On change in residency status of the account holder on production of copy of Passport and visa or Income- tax return (the rule shall not apply for the PPF account opened before 12th December 2019).

Provided that an account under this Scheme shall not be closed before the expiry of five years from the end of the year in which the account was opened.

Provided further that on such premature closure, interest in the account shall be allowed at a rate which shall be lower by one per cent than the rate at which interest has been credited in the account from time to time since the date of opening of the account, or the date of extension of the account, as the case maybe.