PPF Calculator

How PPF interest is actually credited

Interest is calculated on the lowest balance between the fifth and the last day of each month, then credited once annually on 31 March. That crediting rule has a practical consequence most calculators ignore: a deposit made on the 6th earns nothing for that month, while the same deposit on the 4th earns a full month. Depositing the annual contribution before 5 April captures interest for the entire financial year, which over 15 years is worth a meaningful amount.

Limits and term

The minimum is 500 per financial year and the maximum 1,50,000, across all accounts in your name combined. Exceeding the ceiling earns no interest on the excess. The account runs 15 financial years from the year of opening, not 15 years from the deposit date, so an account opened in March matures after what is effectively 14 years and a month of contributions.

Triple tax exemption

PPF is one of the few EEE instruments: contributions qualify for deduction under section 80C, the interest accrues tax-free, and the maturity amount is exempt. That combination makes the effective post-tax return considerably higher than the headline rate for anyone in a higher tax band, and it is the main reason PPF remains competitive against instruments quoting larger nominal returns.

Liquidity is limited by design

Partial withdrawal is permitted from the seventh year, capped at 50 percent of the balance at the end of the fourth preceding year. Loans are available between years three and six. Premature closure is allowed only in narrow circumstances such as serious illness or higher education, and carries an interest penalty. Treat PPF as genuinely locked money rather than accessible savings.

Extension

At maturity the account can be extended in five-year blocks, either with or without further contributions. Extending without contributions still earns interest on the balance and permits one withdrawal per year, which makes it a reasonable place to leave money that is not needed immediately.

The rate is not fixed

The government reviews the PPF rate quarterly. Any projection assumes the current rate persists for the whole term, which over 15 years it certainly will not. Treat the maturity figure as a scenario, not a promise.