Public Provident Fund is the Sovereign Scheme among all small savings schemes that is suitable for the small and middle level Investors.

As per the Government of India’s decision, circular announced by the Ministry of Finance dated December 31st 2021, that to keep the interest rates unchanged on small savings schemes or post office schemes for the January-March quarter of FY 2021-22. 

Post office schemes are chosen mostly by small and middle class investors as these schemes offer stable dividends and there are no risk factors associated.

Post office savings schemes and Interest rates
(1)Savings account 4% with an annual Compounding frequency, (2)Recurring Deposit, 5.8% with a quarterly compounding frequency(3)Time Deposit, 1year, 2year, 3year, 5year as 5.5%, 5.5%, 5.5%, 6.7% with a      quarterly compounding frequency respectively (4)National Savings Monthly account, 6.6% (5)Senior Citizens Savings scheme, 7.4% with a quarterly compounding   frequency. (6)Public Provident Fund (PPF), 7.1% with an annual compounding frequency(7)Sukanya Samriddhi, 7.6% with an annual compounding frequency(8)National Savings Certificates, 6.8% with an annual compounding frequency (9)Kisan Vikas Patra 6.9% with an annual compounding frequency
PPF or Public Provident Fund is a scheme that comes with a supreme guarantee and is packed with several benefits for the common man. Not just generally higher than the Fixed Deposit returns, it can be used to accumulate wealth over the long term. PPF can also be utilized by those individuals who are not covered by Employees Provident Fund (EPF).

 PPF account maturity

PPF account matures after the expiry of 15 years from the end of the Financial Year in which the account was opened, and can be extended to 5years each time. Can close the account for genuine purposes or can continue after completion of either 15 years or after 15+5 years or after 15+5+5 years…

PPF Withdrawal

Maximum withdrawal amount can not exceed 50% of the 4th year ending balance amount or at the immediately preceding year, whichever is lower. Allowed to withdraw once in a year from the 7th year.

PPF Interest Rate

 A PPF account will attract a 7.1% per annum (compounding annually) and one will receive the total interest amount at the end of each Financial Year as it was mandated by RBI.

PPF Minimum Deposit

 One can deposit money in a PPF account any time in a Financial Year, one has to maintain a minimum balance of Rs. 500 and maximum Rs. 1,50,000. One can deposit by cash or cheque or pay online, in lump-sum or instalments.

The PPF account will be discontinued if one fails to deposit a minimum of Rs. 500 in a Financial Year.

Tax on PPF Amount

 Under the section 80C of the Income Tax Act, the deposits will qualify for deduction. The term interests or the lump sum interest, both will be tax-free – making it a lucrative investment.

Post office account holders can easily carry out basic banking transactions through India Post Payment Bank (IPPB). For checking the balance, transferring money and carrying out other financial transactions IPPB can be used very easily.

For the quarter ending March 31, 2022, investors in small savings schemes like the Public Provident Fund (PPF) and Sukanya Samriddhi Yojana (SSY) will continue to earn the same interest rate as they were earning during the quarter ending December ..

Public Provident Fund is the Sovereign Scheme among all small savings schemes that is suitable for the small and middle level Investors.
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