PPF Calculator India 2026 — 7.1% Interest Rate, Returns, Withdrawal Rules and NRI Guide

The PPF interest rate for Q2 FY2026-27 (July to September 2026) is 7.1 percent per annum, compounded annually. The Ministry of Finance confirmed this rate on June 30, 2026 — the rate has remained unchanged since April 2020, making it stable for over 6 years. Interest is compounded annually and credited to the account on March 31 each year. The interest calculation uses the lowest balance between the 5th and the last day of each month, so depositing before the 5th of the month is important for maximum interest — especially for large annual deposits in April.

Investing the maximum ₹1,50,000 per year in PPF for 15 years at 7.1 percent compounded annually gives a maturity corpus of approximately ₹40.68 lakh. Your total investment is ₹22.5 lakh and the tax-free interest earned is approximately ₹18.18 lakh. The entire ₹40.68 lakh is completely tax-free — no tax on the deposit, no tax on the annual interest, and no tax on the maturity amount under the EEE (Exempt-Exempt-Exempt) regime. For a person in the 30 percent tax bracket, the effective pre-tax equivalent return is approximately 10.4 percent — significantly higher than any bank FD after tax.

No. NRIs cannot open new PPF accounts in India. This restriction has been in place for several years. If an NRI had a PPF account before becoming an NRI, that existing account continues to earn 7.1 percent interest until the 15-year maturity date — but no new contributions are allowed and no extensions can be taken. Critically, if an NRI extended their PPF account beyond the 15-year maturity period, that extended account earns zero interest from September 30, 2024 per the latest government circular. NRIs should instead consider NRE Fixed Deposits at 7 to 7.25 percent (completely tax-free in India) or FCNR accounts as alternatives to PPF.

PPF allows two types of withdrawals: loans and partial withdrawals. Loans are available from the 2nd to the 6th financial year at PPF rate plus 1 percent interest, for up to 25 percent of the balance at end of the 2nd preceding year. Partial withdrawals are available from the 7th financial year onwards — one withdrawal per year of up to 50 percent of the balance at end of the 4th year or the preceding year whichever is lower. Both loans and partial withdrawals are tax-free. Full withdrawal of the maturity amount after 15 years is completely tax-free. Premature closure before 15 years is allowed only after 5 years and only for specific reasons — medical emergency, higher education or change to NRI status — with a 1 percent interest penalty.

For long-term savings of 15 years or more, PPF is significantly better than FD for most salaried investors. PPF gives 7.1 percent completely tax-free while FD gives 7 to 7.55 percent that is fully taxable at your income slab rate. For a person in the 30 percent tax bracket the post-tax FD return is only 4.9 to 5.3 percent versus PPF’s effective 10.4 percent pre-tax equivalent. Additionally PPF is government-sovereign guaranteed with no deposit limit on safety, while bank FDs are only insured up to ₹5 lakh per bank under DICGC. PPF also provides 80C deduction on deposits saving up to ₹46,800 more in taxes. The only advantage of FD is higher liquidity — FDs can be broken with a small penalty while PPF is locked for 15 years.

The maximum investment in PPF is ₹1,50,000 per financial year (April to March). This limit applies across all PPF accounts combined — if you have one account for yourself and one opened for your minor child, the combined deposits to both accounts cannot exceed ₹1,50,000 in a financial year. The minimum deposit is ₹500 per financial year. If you miss the minimum deposit in any year the account becomes inactive and needs to be reactivated with a ₹50 penalty per inactive year plus the minimum deposit. Deposits can be made in a lump sum or in multiple tranches throughout the year — up to 12 deposits per year.

No. PPF balance is completely protected from court attachment and cannot be seized by creditors for loan defaults, civil court orders or bankruptcy proceedings. This protection is granted under the PPF Act 1968. The only exception is Income Tax dues — the Income Tax Department can attach PPF balance for unpaid income tax. This makes PPF an extremely safe wealth-building instrument for business owners and self-employed professionals who face business risks. Even if your business fails or you face personal financial difficulty, your PPF savings remain protected and intact.

PPF deposits can be made online through net banking or mobile apps of all major banks. For SBI PPF accounts use the YONO SBI app — go to Accounts, select PPF account, and make an online transfer before the 5th of the month for maximum interest. For HDFC Bank PPF use HDFC net banking or the HDFC Bank mobile app. For post office PPF accounts use the India Post Payments Bank app (IPPB). For accounts opened at ICICI Bank use the iMobile Pay app. Online deposits are instant and credited immediately. Always deposit before the 5th of the month — deposits after the 5th miss the current month’s interest calculation and earn interest only from the following month.