SBI PPF Rates

Public Provident Fund (PPF) is an investment scheme option offered and managed by the Central Government, mainly aiming to benefit small savers over the long term. It is one of the most preferred investment options for individuals, specifically looking for guaranteed returns on their saving amount without any associated market risk. It is typically ideal for small savers who want to regularly deposit a portion of their savings in their respective PPF accounts and gather a corpus in the long term.

Interest rates offered on any PPF are one of the best compared to other fixed-income investment options that may have government backing, such as National Savings Certificate (NSC), Post Office Time Deposits, or any other. Generally, PPF rates are higher than the overall Fixed Deposit rates offered by any bank, especially to promote savings among Indian households for the long-term future.

Features of SBI PPF scheme

Investment Cap: A minimum of Rs 500.00 and a maximum of Rs.1,50,000 per annum may be deposited by the PPF account holder in their respective account.
Investment tenure: Initial duration is 15 years. After that, it can be extended for one or more years (multiple of 5 years) on application by the PPF account holder.
Interest rates: The rate of interest is determined by the Central Government only every quarter. At present, the interest rate of SBI PPF is 7.10% per annum, with an effect from 01.04.2020.
Loan and withdrawals options: Loans and premature withdrawals are allowed depending upon the age of the account and the balance amount in the account as on the specified dates.
Tax benefits: Income Tax benefits are also offered as per Sec 88 of the IT Act.
Nomination facility: A nomination facility is also offered to the customers in the name of one or more persons. The shares of any nominee may also be pre-defined by the account holder/subscriber.
Transferability: The SBI PPF account can be transferred to other branches/ other banks or even to Post Offices and vice versa by the account holder/subscriber upon request. This facility is free of charge.

Eligibility criteria to open PPF account

The following can open a PPF account in SBI:

Indian residents (individuals)
Minor with legal guardians
Senior citizens
A person with an unsound mind with a legal guardian

Points to remember before investing in the SBI PPF investment scheme

The subscriber/customer must not deposit more than Rs.1,50,000 per annum. The excess amount will not earn any additional interest, nor will it be eligible for a rebate as per the Income Tax Act.
The investment amount can be deposited either in lump sum mode or in instalments mode.
Interest is calculated on the minimum balance present in the PPF Account between the 5th day and end of the month and will be payable on 31st March of every year.
Interest income is exempted from Income Tax and TDS. The amount outstanding to the credit is also fully exempted from the Wealth Tax.
An account holder shall be allowed to terminate their PPF account before maturity on an application to the accounts office by filling the Form-5 on any following grounds, namely.

i) To treat any life-threatening disease of the account holder, his spouse, or his dependent children or parents, providing the supporting documents and medical reports confirming that disease from the medical authority.

ii) pursuing of higher education of the account holder or his dependent children by providing documents and fee bills in the confirmation of admission in any recognized institute of higher education in India or abroad

iii) on change in residency status of the account holder/subscriber by providing a copy of valid Passport along with visa or Income tax return.