The Public Provident Fund was introduced by the Government of India in 1968 as a long-term savings instrument aimed at mobilising small household savings while giving depositors a reasonably attractive, tax-advantaged, government-backed return. Unlike a bank fixed deposit, PPF is not offered by commercial banks as a market product but is a government scheme administered through designated bank branches and post offices, with its interest rate set centrally rather than competitively by individual banks. The scheme was designed around a deliberately long lock-in period — originally, and still today, a 15-year standard maturity term — reflecting its intended purpose as a retirement or long-horizon savings vehicle rather than a short-term parking spot for cash. Over the decades, the interest rate has been revised many times, moving from a fixed annual rate set for years at a stretch to the current system of quarterly revisions tied to government bond yields, giving PPF returns a degree of variability similar to (though usually smoother than) other government-linked savings products.

• Salaried and self-employed individuals building a long-term, low-risk savings component alongside market-linked investments like mutual funds or stocks.
• Parents opening a PPF account in a minor child's name to build a corpus for future education or other long-term goals.
• Retirement planners using PPF as one guaranteed, tax-advantaged component within a broader retirement portfolio alongside EPF, NPS, and market investments.
• Tax-conscious savers comparing the after-tax return of PPF against other tax-saving instruments available under the same broad deduction category.
• Self-employed professionals without employer EPF who lack access to a workplace provident fund and use PPF as their primary long-term, government-backed retirement savings vehicle.
• NRIs with existing PPF accounts opened before a change in residency status, who want to understand how the account continues to grow even though new NRI accounts are generally not permitted to be opened.

A PPF account can generally be opened by any resident individual Indian citizen, at designated bank branches or post offices, either in their own name or on behalf of a minor child (with the parent or guardian operating the account until the child reaches majority). Hindu Undivided Families (HUFs) are generally not permitted to open a PPF account, and non-resident Indians are generally not permitted to open a new account, though an account opened while the holder was still a resident typically continues to run until maturity even after a change in residency status, subject to specific rules that have evolved over time. Because eligibility rules and residency-status implications can change, anyone uncertain about their specific situation should confirm directly with their bank or post office before attempting to open, continue, or extend an account.

Opening a PPF account is a straightforward process at most public and several private sector banks, as well as post offices: the applicant typically fills out an account-opening form, provides standard identity and address proof, submits a passport-sized photograph, and makes the minimum opening deposit. Many banks also allow PPF account opening entirely online for existing customers through net banking or a mobile app, which links the PPF account directly to a savings account for easy future deposits. Nominees can and should be registered at account opening (or added later) to simplify the transfer of funds in the event of the account holder's death before maturity — a step that is often overlooked but matters a great deal in practice.

1. Each year, the annual deposit is added to the running account balance.
2. Interest for the year is calculated on the balance and credited (illustratively, annually).
3. This deposit-then-compound cycle repeats every year for the full tenure of the account.
4. The final balance after the last year is the maturity value.

In practice, PPF interest is actually calculated monthly on the lowest balance between the 5th and the last day of each month, and credited annually — this calculator uses a simplified annual-compounding model for illustration, which will differ slightly from the exact monthly-computed figure on your actual passbook.

Notice how the interest earned in later years is meaningfully larger than in early years, even though the deposit amount stays the same — this is compounding at work, since interest is calculated on an ever-growing balance rather than on the deposit alone.

Suppose a saver opens a PPF account and deposits ₹₹6,000 at the start of every financial year, and the account earns an illustrative 6.4% annual rate, compounded once a year on the running balance, for the full 5-year tenure.

1. Year 1: deposit ₹₹6,000, balance becomes ₹₹6,384 after interest.
2. Each subsequent year: add ₹₹6,000 to the existing balance, then credit interest at 6.4% on the new, larger total.
3. By year 5, the balance has grown to about ₹₹36,276, reflecting several years of compounding on top of the accumulated deposits.
4. By the final year (5), the balance reaches approximately ₹₹36,276, of which roughly ₹₹30,000 came from the saver's own deposits and the remainder, about ₹₹6,276, came from compounded interest.

Notice that the proportion of the final balance attributable to interest, rather than to deposits, tends to grow the longer the money stays invested — this is the core argument for opening a PPF account as early as possible and extending it beyond the initial 15-year term where the goal genuinely calls for a very long horizon.

When a PPF account reaches its standard 15-year maturity, the account holder generally has three broad choices: withdraw the entire balance and close the account, extend the account for a further block of 5 years while continuing to make deposits and earn interest, or extend the account for a further block of 5 years without making any further deposits, with the existing balance continuing to earn interest at the prevailing rate. Each choice suits a different situation — full withdrawal makes sense if the funds are needed for an immediate goal, continued-deposit extension suits someone still saving toward retirement or another long-term target, and extension-without-deposits suits someone who wants the balance to keep compounding tax-free without adding new money. The decision to extend (in either form) typically must be communicated to the bank or post office within a specified window after maturity — missing this window can affect the terms available, so it is worth planning the choice well before the maturity date arrives rather than deciding at the last moment.

• Minimum deposit per financial year: commonly cited as ₹500 to keep the account active.
• Maximum deposit per financial year: commonly cited as ₹1.5 lakh; deposits above this do not earn interest or qualify for tax benefit.
• Standard maturity: 15 years from the end of the financial year of account opening, extendable in 5-year blocks.
• Partial withdrawals: typically permitted from the 7th financial year onward, subject to a cap.
• Loan facility: typically available between the 3rd and 6th financial years, subject to specific terms.

Every one of these figures — the minimum, the maximum, the withdrawal window, and the loan window — is set by government notification and can be revised, so always confirm the current rule with an official source such as the Ministry of Finance or your account-holding bank/post office before making a decision based on it.

PPF has historically been described as an “EEE” (Exempt-Exempt-Exempt) instrument: the annual deposit has typically qualified for a deduction under the relevant section of the Income Tax Act (subject to an overall combined cap across similar instruments), the interest credited each year has typically been exempt from tax, and the maturity amount has typically been fully tax-free on withdrawal. This three-way exemption is one of the most attractive features of the scheme relative to many market-linked alternatives, but tax law can change, and eligibility for the deduction may depend on which tax regime (old or new) you have chosen for a given financial year — verify current rules with a tax professional before assuming the full EEE treatment applies to your specific situation.

PPF's appeal is its combination of a government guarantee and full tax exemption, at the cost of a long lock-in and a return that, while historically steady, has typically been lower over the long run than well-diversified equity investing — most financial plans use PPF as one stabilising component rather than the sole savings vehicle.

• Deposit early in the financial year (before the 5th of April, if possible) rather than at the end, since interest is calculated on the lowest balance between the 5th and last day of each month.
• Deposit the full amount as a lump sum early in the year if cash flow allows, rather than spreading smaller deposits across the year, to maximise the number of months earning interest on the full amount.
• Track the account's maturity date and decide well in advance whether to extend it, withdraw fully, or extend without further contributions.
• Keep a copy of your passbook or online statement to independently verify the interest credited matches the currently notified rate for each period.

• Depositing late in the financial year (e.g., in March) and losing most of that year's potential interest.
• Missing the minimum yearly deposit and having the account go inactive, requiring back-payment with penalty to reactivate.
• Assuming the interest rate is fixed for the life of the account, when it is actually revised quarterly by the government.
• Depositing more than the annual cap across multiple accounts (including a minor's account) without realising the combined cap applies per individual.
• Not planning ahead of the 15-year maturity date, resulting in a rushed decision about extension or withdrawal.

A PPF calculator projects how a fixed annual deposit grows over time under a given interest rate assumption, but the actual rate is revised every quarter by the government, and the exact monthly compounding mechanics differ slightly from a simplified annual model. Use this illustration to understand the shape of long-term compounding within PPF, not as a guaranteed prediction of your account's exact future balance.

Depositing consistently and early in the financial year, and planning ahead of the 15-year maturity date, matter more to your actual outcome than any single rate assumption used in an illustrative projection.

Because PPF sits at the intersection of savings discipline, government policy, and tax planning, it is worth revisiting your account's standing every few years — checking the current interest rate, confirming your nominee details are up to date, and reassessing whether continued deposits still make sense relative to your other financial goals — rather than treating it as a fully set-and-forget instrument for its entire multi-decade life.

This calculator models annual deposits compounded once per year on the running balance, over the number of years you specify, using the interest rate you entered or the current default. Actual PPF interest is computed monthly on the lowest balance between the 5th and last day of each month, and credited to the account annually, which can produce a slightly different figure from this simplified model. This is general educational information, not investment or tax advice — verify current PPF rules, deposit limits, and the notified interest rate with your bank, post office, or the Ministry of Finance before making a financial decision.