The PPF (Public Provident Fund) account is really the best savings account for an employee. Every employee gets this account which is very safe and a long-term investment. PPF also offers many tax benefits. Therefore, when an employee retires, he has enough money in his account to lead a peaceful life.

You also get an interest on the amount that is kept in the PPF account. The interest rates are determined by the government entities and are subjected to change. In this article, the latest PPF interest rates for 2017-18 and its calculation. Also, this being a PPF account, no tax will be applied to the interest earned. The deposits that are made in the PPF account are also eligible to be claimed as tax deductions. In addition, the maturity amount is also exempted from any form of tax. All these features make it one of the best investment option in India.

The Current Interest Rate for PPF in 2017-18

The current interest rate that is offered for PPF accounts in the first quarter of the 2017-2018 financial year is 7.9%. The previous year, it was 8.0% which means that there is a 0.1% decrease in the interest rate.

How is PPF Interest Calculated (FAQs)

• The interest is compounded yearly for PPF accounts. And as I mentioned earlier, there is no tax on this interest. Add to this the fact that this is a long-term investment of more than 15 years. Therefore, the corpus saving will be huge at the end.
• A minimum of Rs 500 should be deposited in your PPF account each year. Maximum deposit allowed is of Rs 1,50,000 in one year.
• You will have the freedom of deciding of how much amount you will be needing after you retire and start saving accordingly.
• After you’ve completed 7 years or more, you are allowed to make partial withdrawals. But there are conditions for these withdrawals.
• In between the 3rd to 6th year, you are allowed to take loans against your balance in the PPF account.

Now I’ll show you how the PPF interest and the final maturity amount is calculated. This will also determine the amount that you can withdraw or the loan you can get against this account.

You May Also Like: PPF Withdrawal Rules (Partial & Complete) Before And After Maturity

PPF Interest Rate

• The PPF account interest rate is decided and updated by the central government in every quarter.
• PPF account interest is compounded yearly.
• The Interest Rates for PPF accounts is exactly the same for all the banks and post offices across India.

Interest Rate Calculation on the maximum amount of Rs 1.5 lac that can be deposited yearly is as below:

When you invest Rs 1.5 lac every year, then the maturity amount after 15 years will be Rs 44,37,132. And this is how it will be calculated:

The Current PPF Interest Rate are as follows for the banks:

The list of banks in which you can open a PPF account is given below:

Public Sector Banks:

1. State Bank of India
2. State Bank of Travancore
3. Dena Bank
4. State Bank of Hyderabad
5. State Bank of Bikaner and Jaipur
6. Allahabad Bank
7. State Bank of Patiala
8. Bank of Baroda
9. Canara Bank
10. Bank of India
11. Bank of Maharashtra
12. State Bank of Mysore
13. Central Bank of India
14. Corporation Bank
15. IDBI Bank
16. Indian Overseas Bank
17. Oriental Bank of Commerce
18. Punjab National Bank
19. Union Bank of India
20. United Bank of India
21. Andhra Bank
22. Vijaya Bank
23. Punjab and Sind Bank
24. UCO Bank

Private Sector Banks:

1. ICICI Bank
2. Axis Bank
3. HDFC Bank

Remember that not all the branches of these banks are authorized to open PPF account. Go to the nearest branch of the bank in which you want to open your PPF account. The branch people will give you information about the branch that is authorized to open this account. You can also call on their customer care number or check their official website for this information.

If you have any queries or suggestions, please leave a comment below.