This Post Office Scheme Offers 7.1% Interest On Deposits; Much Higher Than Banks!

This Post Office Scheme Offers 7.1% Interest On Deposits; Much Higher Than Banks!
This Post Office Scheme Offers 7.1% Interest On Deposits; Much Higher Than Banks!

PPF or Public Provident Fund is a scheme that comes with a sovereign guarantee and power-packed with several benefits for the common man. Not just generally higher than the FD 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 Maturity, Closing/Withdrawal Rules, Interest Rates, Minimum Deposit and Tax

From the end of the financial year in which the account was opened, PPF account matures after the expiry of 15 years. PPF account holders can extend their account in blocks of 5 years each after maturity.

It is generally not advisable to prematurely close the PPF account before 15 years. However, post the completion of 5 years, one can prematurely close the account for specific purposes like medical treatment, higher education etc.

From the 7th year, one withdrawal is allowed in a year. However, the maximum withdrawal can be 50 per cent of the balance amount at the end of the fourth year or the immediately preceding year, whichever is lower.

As mandated by RBI, A PPF account will attract a 7.1 per cent per annum (compounded yearly) and one will receive the total interest amount at the end of each FY. In an (financial year) FY, one can deposit money in a PPF account any time in a year, one has to maintain a minimum balance of Rs. 500 and maximum Rs. 1,50,000.

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

According to one’s conveniences by cash or cheque or pay online, one can make the deposits in lump-sum or instalments. 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.

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

Step-By-Step Guide for Transferring Money in your Post Office PPF through IPPB

  • Add money from your bank account to your IPPB account.
  • Go to DOP services.
  • From there you can choose products- Recurring Deposit, Public Provident Fund, Sukanya Samridhi Account, Loan against Recurring Deposit.
  • If you want to deposit money in your PPF account, then click on Provident Fund
  • Enter your PPF Account Number and DOP Customer ID.
  • Mention the amount that needs to be deposited and click on the ‘Pay’ option. IPPB will then notify you for successful payment transfer made through IPPB mobile application.
  • You can opt for various post office investment options provided by India Post and make regular payments through IPPB basic savings account.

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