Since there is the involvement of government in this scheme, there is no risk of losing your money and returns are guaranteed. The tenure of this scheme is 5 years that can further be extended for 5 more years on request. Some cases also allow for partial withdrawal before time.

Features of PPF Investments

The main characteristics or features of PPF account can be enlisted as follows:

  • Investment period: The lock in period of PPF investments is 15 years before which no complete withdrawals are allowed. This tenure can be extended by 5 more years on request by the investor.
  • Principal amount: The investment under PPF account can be made from Rs 500 to Rs 1.5 Lakh annually either in lump sum or on an installment basis. However, eligibility under this scheme allows for only 12 installments in a single year.
  • Loan Against Investment: Loans can be undertaken by the investor on their respective PPF account. This loan is only granted if taken from the third year beginning to the sixth year end from the account activation.
  • Eligibility: Only Indian citizens along with minors are allowed to open a PPF account. Existing accounts on the name of NRIs are active but no new accounts are opened on their name.  
  • PPF Account Interest: Central government of India determines the interest payable on a PPF account. It is updated quarterly and is higher than what is provided by various commercial Indian banks.

Benefits of PPF Account

There are several benefits to investing in PPF schemes. Let us take a look at a few of them.

  • Low minimum investment: Investments under scheme start from as low as RS 500 per year making it available to lower income group too.
  • Tax exemptions: Several income tax exemptions are applicable on the PPF investments. Both the principal amount as well as the interest comes under this exemption.
  • Withdrawal: Though there is a mandatory lock in period of 15 years in case of PPF investments, investors can withdraw some amount in case of certain emergencies. This can only be done after 5 years of activation of the account and subject to certain terms and conditions.
  • Premature Closure: PPF accounts allow premature closure of the investment under certain terms and conditions. However, this can only be done after completion of 5 years of investment and on fulfillment of certain pre-written criteria.
  • Security: Being a government backed scheme, PPF investors enjoy a certain safety of their investment from the market risks.


PPF are a popular investment tool that has been encouraged by the government due to the benefits provided by it in terms of safety, interest rates and taxes. If you are looking for more information regarding this investment fund or any other fund to be specific, call our financial experts today for advice and guidance.


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