This is a bank account type that is specifically designed for the benefit of common citizens. It is a saving scheme that works on a long-term basis. The main purpose of a PPF account is to offer an all-round tax benefit to the user. In India, it began in 1968 for mobilizing small savings in the form of an investment comprising a return on it. It even builds a retirement corpus by saving hugely on annual taxes; that’s why it's also called a savings-cum-tax savings investment tool. Any person or investor willing to opt for a secure investment option to benefit from guaranteed returns should go for a PPF account. The money in the account can be used for almost any purpose. You can use the money to pay your monthly bills or even invest it in certain areas. Many people do prefer to invest the money instead of saving it in their account because the money grows tax-deferred. When you make minimum distributions from the account, the taxes are deferred until the investor dies. One can also use the public provident fund account to purchase bonds to earn higher returns. Many companies offer what a public provident fund is. However, these companies may charge a fee for the services they render. If you want to get your account, you can directly contact us. You can find all the necessary details of the same on the web while checking on our portal.
Features Associated with a PPF Account
- A PPF account offers a tenure of a minimum of 15 years, which can get extended in blocks of five years each.
- A PPF account can get opened with only Rs. 100. If annual investments reach beyond 1.5lacs, there will be no interest and won’t be eligible for tax savings
- One has to deposit at least once a year into a PPF account for 15 years.
- PPF accounts allow deposits through cheque, cash, online fund transfer, or Demand Draft.
- One cannot open joint accounts through a PPF account.
- It is allowed to a PPF account holder to opt for a nominee.
- A PPF account remains backed by India's Government; that’s why it proposes risk-free and guaranteed returns while protecting the whole capital. The associated risks are minimal (if any).
Who Can Go for a PPF Account?
Anyone who’s a resident of India can open a PPF account. Non-resident Indians (NRI) are not allowed to open PPF accounts. But a resident Indian who already has a PPF account and then became an NRI can continue with his/her account till it matures. Also, parents can open up a PPF account for minor children. No one can open multiple or joint accounts through PPF.
What are the Essentials Required to Open a PPF Account?
- An address proof.
- An ID proof.
- A photograph of the account holder.
- A nomination form.
Opening a PPF account turns out to be a good choice for the ones who’re willing to go with these accounts as a long-term investment, such as a lock-in period of 15 years. It doesn’t only save you taxes but also offer beneficial plans and schemes from time to time.