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Written by
Abhishek Chakravarti
BFSI Writer
Abhishek is a financial writer with over 6 years of experience in the BFSI sector. Prior to his current stint with Axis Max Life Insurance, he has worked with leading fintech startups. He specializes in writing about taxation and various investment products like ULIPs, retirement plans, guaranteed investment plans, mutual funds etc.
Reviewed by
Sahil Rawal
BFSI Expert
Sahil Rawal is a digital & brand management specialist with over 10 years of experience in Financial Services Industry. Life insurance professional with expertise in digital marketing strategy, website content marketing and brand communication designed to increase brand awareness, drive engagement & sales.
Before you plan on investing, it is important to know all about what is PPF account and how it works. Public Provident Fund or PPF was introduced in 1968 and it is still one of the popular long-term investment plans in India. This is an ideal plan for all those looking to achieve their long-term goals and planning to create a financial corpus for their retirement. This plan comes with a lock-in period of 15 years, though the investor can make partial withdrawals after the 7th year of the policy.
Now that you know what is PPF account, let us now look at a few benefits of investing in the Public Provident Fund investment plan.
Numerous reasons make Public Provident Fund Investment Plan an ideal long-term investment plan. Some of the benefits of the PPF plan are mentioned below.
One of the key benefits of investing in the PPF investment plan is that it provides financial security to you and your loved ones. In the worst-case scenarios, if you meet an untimely and unfortunate demise and are not there to provide financial backup to your family, the PPF investment plan will ensure that they are financially secure and can manage their lives without hassles.
Another key benefit of investing in the PPF investment plan are the tax benefits it offers. The PPF subscriber can claim up to Rs. 1.5 lakhs in tax deduction benefits on investments made in a financial year under Section 80C of the Income Tax Act, 1961. Moreover, the interest earned by the subscriber is also exempt from tax.
When we retire, we want to enjoy our golden years with our loved ones without having to face any financial hassles. Investing in the PPF investment plan helps ensure that you are financially secure even after you retire.
We never know when we might face a financial emergency and might have to take a loan. Those who have invested in the PPF investment plan can opt for a loan against this policy during the 3rd and the 6th year of the policy. The maximum amount of loan you can avail of is 25% of the total amount available at the end of the 2nd year of opening the PPF account. This facility is beneficial for investors who are looking for loans for short-term financial requirements. Another benefit of this facility is that it helps you secure your valuable assets, such as your house and car, and ensure that you do not have to take a loan using your assets as security.
You can open a PPF account via either the online or offline. The traditional offline method involves visiting your nearby bank branch or India Post Office to fill out and submit the PPF account opening form along with applicable KYC documents. However, these days you can open a PPF account online from the comfort of your home.
Mentioned below are the key steps you need to complete in order to open your Public Provident Fund Account online:
The first step toward opening your PPF account is to sign into your bank account. Currently public sector banks as well as a few top private sectors banks allow you to open a PPF account. After logging into your bank account, click on the tab which offers the accountholder to open the PPF account
After clicking on the tab, you will be redirected to a new page wherein you will have to fill in your personal details, such as name, age, address, PAN, Aadhaar, etc.
The next step is to verify the details you have provided and then click on proceed.
After you verify your details, your PPF account will be created, and your account number will be displayed.
After your account has been created, visit your bank branch to get the KYC done of your PPF within 30 days of registration for the process to move forward.
1. Any Indian citizen can open the Public Provident Fund investment account under his/her name or on behalf of a minor.
2. However, you must remember that you cannot open a joint account for PPF, though you can add a nominee such as your spouse, parents, or children.
You now have comprehensive information on what is PPF account, its features and benefits and who are eligible to open a PPF account. Investing in the PPF investment plan will make sure that you and your family live a peaceful life and do not face any financial hassles. Moreover, by making PPF investments you will be able to achieve various long-term goals, such as a child's education and marriage, buying a house, etc, with ease.
ARN No: May22/Bg/26A
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