PPF explained: rate, rules and how much it grows
PPF pays 7.1% tax-free for Oct–Dec 2026. ₹1.5 lakh a year for 15 years grows to about ₹40.7 lakh.
The Public Provident Fund is a 15-year government savings scheme with tax-free returns.
Key rules
- Rate: 7.1% a year for October–December 2026. The government sets it every quarter. See current small savings rates.
- Deposit: at least ₹500 and at most ₹1.5 lakh in a financial year.
- Term: 15 years, then extendable in blocks of 5 years, with or without fresh deposits.
- Tax: deposits qualify under Section 80C in the old regime; interest and maturity are tax-free.
How much it grows
Depositing ₹1.5 lakh at the start of every year at 7.1%:
| After | Deposits | Balance |
|---|---|---|
| 15 years | ₹22.5 lakh | about ₹40.7 lakh |
| 20 years (deposits continue) | ₹30 lakh | about ₹66.6 lakh |
| 20 years (no deposits after 15) | ₹22.5 lakh | about ₹57.3 lakh |
Tip: deposit before the 5th of the month (ideally before 5 April) so that month's deposit earns interest.
This article is general information, not personal financial advice. Rules and rates change; check the latest before you act.