Public Provident Fund (PPF)

Salient Features:

Interest rate of 8.8% per annum w.e.f. 01.04.2012.

Minimum deposit is 500/- per annum. Maximum deposit is Rs. 1,00,000/- per annum

The scheme is for 15 years.

Investment up to Rs 1,00,000/- per annum qualifies for Income Tax Rebate under section 80C of IT Act.

Interest is completely tax-free.

Deposits can be made in lumpsum or in 12 installments.

One deposit with a minimum amount of Rs 500/- is mandatory in each financial year.

Withdrawal is permissible from 6th financial year.

Loan facility available from 3rd financial year upto 5th financial year. The rate of interest charged on loan taken by the subscriber of a PPF account on or after 01.12.2011 shall be 2% p.a. However, the rate of interest of 1% p.a. shall continue to be charged on the loans already taken or taken up to 30.11.2011.

Free from court attachment.

Non-Resident Indians (NRIs) not eligible.

An individual cannot invest on behalf of HUF (Hindu Undivided Family) or Association of persons.

Ideal investment option for both salaried as well as self employed classes.