Personal Finance

PPF: What you need to take note of

K Venkatasubramanian | Updated on November 18, 2018 Published on November 18, 2018

Here are some operational aspects of the debt scheme youmust be aware of

Public provident fund (PPF) is a popular debt scheme for investors, given its attractive tax-free treatment and the long tenure of 15 years that allows you to save towards long-term goals.

While the investment angle is well-understood, there are a few operational aspects — shifting accounts between banks and post offices, withdrawal mode at the end of the tenure, and the actual number of yearly instalments you need to make — that are not highlighted. You should be aware of these procedural points so that your PPF account operation remains smooth.

Not just 15 years

The PPF term does not close by the end of 15 years from the date of the first instalment. It actually spans 16 financial years. The 15 years start from the end of the financial year when the first payment is made. So if you open a PPF account on November 12, 2018, the 15-year tenure starts from April 1, 2019, and the maturity will be April 1, 2034.

Therefore, you end up paying 16 annual instalments instead of 15, which means you end up saving that much more.

Of course, you can also make monthly investments in your PPF account, though the total amount is restricted to ₹1.5 lakh a financial year.

Shifting accounts

Your job can lead you to shift base every few years. Even while moving from one city to another, you can transact easily on your PPF account.

You can transfer/shift your PPF account to a different branch of the same bank in a different city and also between banks and post offices. If you have an operational account — a minimum of ₹500 invested every financial year — you can move accounts easily.

For example, if you want to move from one bank to another or from a post office to a bank in your new place or to a new branch of the same bank, you will have to first give a written request to your exiting branch. Even if you transfer an account, the account will be treated as live, subject to the condition mentioned earlier; new investments in the new branch will be treated as a continuation of your previous investments.

After your written request/application is processed, the existing bank/post office will send the original documents pertaining to your account to the new bank/branch of your choice. These documents include a certified copy of the account, the account opening application, nomination form and specimen signature, along with a cheque/DD for the outstanding balance in the PPF account.

Once these documents are received at the new branch, you have to submit a fresh PPF account opening form (Form A) and nomination form (Form E or Form F in case you wish to change the beneficiaries), along with your original passbook. You also need to complete the know-your-customer procedure afresh by submitting the relevant documents — PAN, address proof, etc. Though the process sounds daunting, it is fairly simple and can be done without many hassles.

After this transfer is done, you can transact smoothly.


Unless you wish to extend your PPF account after maturity — allowed in blocks of five years — you can withdraw your accumulated corpus.

There are two options. You can have the proceeds transferred directly to your savings account through the NEFT route, or you can opt for a demand draft/banker’s cheque. The former will be the better option as it will ensure a seamless transfer.

If you have a PPF account in a PSB in a different city from the one you reside in, you do not have to travel to the old location to redeem the maturity proceeds.

You can walk into the local branch of the PSB and give a written request. After scanning through your documents and request, and taking your signature in front of the manager/relevant official, the bank will attest these documents and forward your request to the branch where you hold the PPF.

By giving a cancelled cheque of the new bank account, you can request for a NEFT transfer to that account.

Published on November 18, 2018

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.