Public Provident Fund

P.P.F. is scheme introduced by the National Saving Institute of ministry of Finance in 1968.The purpose of this scheme was to mobilize small saving by offering a investment with reasonable return.Even , it gives the individual to be exempted from the tax .

Any one can open this account with any nationalized bank ,authorized private bank or post offices.Nomination facility is also available with more than one person with description of share by the subscriber.

A minimum of 500 and a maximum of 1.5 lac can be deposited ,annually .The minimum maturity period is 15 years but it can be extended after in a quanta of 1 or 5 year each. Extension can be with contribution option or without contribution option.If action not taken within one year  at maturity ,the extension without contribution will be set as default, Rate of interest being 8.7% effective from April ,2013.Interest is paid on 31 st March of each year.

A subscriber can request for change of the the branch or post office with free service charges.

Though the maturity period is for 15 year , a premature withdrawal can be made after the end of 6th FY.Any one can withdraw prematurely only 50% of the amount stood at the end of  the 4th year preceding the the year in which amount is with drawn.

In case ,failing to pay minimum annual amount in year will cause inactivation of the account .In order to activate , a penalty of RS 50 has to be paid along with the amount of that year.

Note – A   N.R.I. ( he should not become NRI after opening of Account) is not applicable for this scheme.

Click here for government certification in Accounting, Banking & Finance