Top 10 Benefits of Opening a PPF Account in India

In the world of personal finance, finding a balance between safe returns and tax savings is a real win. One investment that ticks both these boxes is the Public Provident Fund, more commonly known as PPF. For decades, it has remained one of the most trusted and beneficial long-term investment options in India—and for good reason.

If you're looking to understand why millions rely on it, here are the top 10 benefits of opening a PPF account in India, especially if you're planning your financial future wisely.

1. Tax savings under Section 80C

One of the biggest reasons people invest in a PPF account is the PPF tax savings. Under Section 80C of the Income Tax Act, you can claim a deduction of up to ₹1.5 lakh annually. That means your investment doesn’t just grow—it reduces your taxable income.

2. Completely tax-free returns

Unlike some other instruments, the interest you earn on your PPF deposit—and the amount you withdraw at maturity—is tax-free. This makes PPF one of the most tax-efficient safe investment schemes in the country.

3. Government-backed safety

Since PPF is a government-sponsored scheme, it's among the safest investment schemes out there. Your money is not tied to market risks, and returns are guaranteed. For anyone who values financial security, that’s a big plus.

4. Attractive Current PPF interest rate

The current PPF interest rate (as of Q1 2025) stands at 7.1% per annum, compounded annually. This rate is revised quarterly by the Ministry of Finance and remains one of the highest among fixed-income investments with such a low risk.

5. Long-term maturity period for financial discipline

With a PPF maturity period of 15 years, this scheme encourages consistent saving habits. You can extend it in blocks of 5 years after maturity, which is great for building wealth gradually.

6. Partial withdrawals and loan options

From the 7th financial year, you can make partial withdrawals from your PPF account. Additionally, between the 3rd and 6th year, you’re eligible for loans against your balance. That’s handy when you need liquidity without breaking your investments.

7. Flexible investment amounts

You don’t need a massive sum to get started. With as little as ₹500 annually, you can maintain your PPF account and invest up to ₹1.5 lakh in a year. This flexibility makes it suitable for students, salaried professionals, and even retirees.

8. Protected from creditors

Here’s something many don’t know—your PPF account is protected from any court decree. If you’re ever in financial trouble, your PPF savings cannot be attached by creditors, giving you peace of mind.

9. Simple account opening process

Knowing how to open a PPF account is simpler than ever. With many banks offering online options, including the Bank of Maharashtra. You can open and operate your account from the comfort of your home.

10. PPF Nomination and inheritance benefits

You can easily nominate a family member for your PPF account. In case of unforeseen events, this ensures a smooth transfer of funds to your nominee, supporting their financial future.

Wrapping Up

If you're aiming for a secure, tax-free, and flexible investment, opening a PPF account is a smart move. It checks off all the boxes—safe investment schemes, tax deductions, stable returns, and long-term financial planning.

And when you open your PPF account with a reliable public sector bank like Bank of Maharashtra, you enjoy added benefits like government backing, secure online banking, and a trusted financial partner every step of the way.

Whether you’re just starting your financial journey or looking to diversify your portfolio, the Public Provident Fund deserves a place in your investment mix.

Author: Bank of Maharashtra
Date of Publish: 23 Apr, 2025