PPF rules: everything you need to know
Rules for FY 2026-27 · Checked 24 October 2026
PPF pays 7.1% a year, tax-free. You deposit ₹500 to ₹1.5 lakh a year for 15 years, can extend in 5-year blocks, take loans from the 3rd year and withdraw part of the balance from the 7th year.
The basics
| Rule | Detail |
|---|---|
| Who can open | Resident Indians, one account each. Parents can open one for a minor child. |
| Deposit | ₹500 to ₹1.5 lakh per financial year, in one go or in up to 12 instalments |
| Interest | 7.1% a year (October to December 2026), reviewed quarterly, compounded yearly |
| Term | 15 full financial years, then extendable in blocks of 5 years |
| Tax | Deposits under 80C (old regime); interest and maturity tax-free |
| Where | Post offices and most banks |
How interest is worked out
Interest for each month is calculated on the lowest balance between the 5th and the last day of that month, and credited once a year on 31 March. Deposit before the 5th of the month, and ideally before 5 April, to earn the full year’s interest.
Loans and withdrawals
- Loan: from the 3rd to the 6th financial year, up to 25% of the balance at the end of the second year before. Interest is 1% above the PPF rate if repaid within 36 months.
- Partial withdrawal: once a year from the 7th financial year, up to 50% of the balance at the end of the 4th year before, or of the previous year, whichever is lower.
- Early closure: after 5 years, only for serious illness, higher education or a move abroad, with 1% less interest.
Extending after 15 years
Within a year of maturity you can extend the account by 5 years, as many times as you like, with deposits (submit the form) or without deposits (just leave it, and it keeps earning interest).
₹1.5 lakh a year at 7.1% grows to about ₹40.7 lakh in 15 years, ₹66.6 lakh in 20 and ₹1.03 crore in 25. Try it with the PPF calculator.
Frequently asked questions
Can NRIs invest in PPF?
NRIs cannot open a new account. An account opened while resident can continue until maturity, but cannot be extended.
Can PPF be seized to pay debts?
No. A court order cannot attach a PPF balance, which makes it a safe store of savings.
What if I deposit more than ₹1.5 lakh?
The extra earns no interest and does not count for 80C. It is returned to you.
Sources: National Savings Institute, India Post