The Government of India has officially announced the interest rate for the Public Provident Fund (PPF) for Q1 of FY 2025-26 (April to June 2025). The interest rate remains unchanged at 7.1% per annum, compounded annually. For both seasoned investors and first-time savers, this is a golden opportunity to start or continue investing with as little as Rs 500.
The PPF scheme is a government-backed, long-term savings tool that offers attractive interest rates, tax benefits, and capital safety, making it a favorite among Indian households. Whether you’re planning for retirement, your child’s education, or just building a solid financial foundation, PPF is one of the most trusted instruments.
PPF Interest Rate April to June 2025
| Feature | Details |
|---|---|
| Interest Rate | 7.1% per annum (compounded yearly) |
| Minimum Investment | Rs 500 annually |
| Maximum Investment | Rs 1.5 lakh annually |
| Tenure | 15 years (extendable in blocks of 5 years) |
| Tax Benefits | Tax deduction under Section 80C + tax-free interest |
| Loan Facility | Available between 3rd and 6th financial year |
| Partial Withdrawal | Allowed from 7th financial year |
| Official PPF Page | India Post PPF Scheme |
With the PPF interest rate for April–June 2025 locked at 7.1%, now is the perfect time to start or continue investing. With just Rs 500, you can build a strong, tax-free corpus over time. Whether you’re a student, a salaried employee, or a parent planning for the future, PPF remains a top-tier, low-risk investment.
What is PPF and Why Should You Invest in It?
The Public Provident Fund (PPF) was introduced by the Government of India in 1968 to encourage small savings with reasonable returns combined with income tax benefits. It is one of the few investment options that falls under the EEE (Exempt-Exempt-Exempt) category:
- Your contribution (up to Rs 1.5 lakh/year) is tax-deductible under Section 80C.
- The interest earned is tax-free.
- The maturity amount is completely tax-free.
Why It’s Great for Everyone
- Beginners can start small with just Rs 500.
- Professionals can use it for long-term, low-risk wealth accumulation.
- Parents can open a PPF account in their child’s name and build a future fund.
Real-Life Example:
If you invest Rs 5,000 every month in a PPF account for 15 years, you’ll have over Rs 16.3 lakh at maturity, completely tax-free.
see also: Small Savings Schemes 2025, Interest Rates Remain Intact
How the PPF Interest Works
The interest on your PPF is calculated monthly but credited annually on March 31. The crucial thing to remember is: Interest is calculated on the lowest balance between the 5th and the last day of each month. So, to earn maximum interest, make sure to invest before the 5th of every month.
How to Open a PPF Account
You can open a PPF account at:
- Post Offices
- Authorized Banks like SBI, HDFC, ICICI, Axis Bank, etc.
- Online (Net banking/ Mobile banking for existing customers)
Documents Needed:
- Aadhaar card
- PAN card
- Passport-size photo
- Address proof
- Bank account linked with Aadhaar
How to Deposit in a PPF Account
You can deposit in your PPF account in lump sum or in a maximum of 12 installments per year. It can be done via:
- Cash (at post office/bank)
- Cheque or demand draft
- Online transfer via net banking or mobile app
How Safe is the PPF Scheme?
Being a government-backed scheme, PPF is considered one of the safest investment avenues in India. There is no market risk, and your capital is fully protected. Even if the financial institution fails, your PPF account remains safe.
SBI Vs Post Office: 2 लाख की FD पर कौन दे रहा है ज्यादा रिटर्न, जानें निवेश की पूरी डिटेल
PPF vs Other Investment Options
| Investment Option | Interest Rate | Lock-in Period | Tax Benefits |
|---|---|---|---|
| PPF | 7.1% | 15 years | EEE |
| Fixed Deposit | 6%–7.5% | 1–5 years | Taxable interest |
| National Savings Cert. | 7.7% | 5 years | Interest taxable |
| ELSS Mutual Funds | Market-linked | 3 years | Tax on capital gains |
As you can see, PPF offers a perfect balance between safety, decent returns, and tax savings.
Pro Tips to Maximize Your PPF Returns
- Deposit before April 5 each year to ensure your full annual deposit earns interest for the whole year.
- Invest monthly before the 5th of each month for maximum interest.
- Continue beyond 15 years – you can extend in 5-year blocks and continue to earn tax-free interest.
- Open a PPF for your child – you can invest on their behalf and create a future education/marriage fund.
see also: Post Office RD Scheme: Depositing ₹1000, ₹2000, ₹5000 and ₹10,000
Interest Rate of PPF FAQs
1. What is the current PPF interest rate?
The current PPF interest rate is 7.1% per annum, valid from April to June 2025.
2. Is there any risk in PPF?
No. PPF is a government-backed scheme, making it one of the safest investment options in India.
3. Can I withdraw money before 15 years?
Partial withdrawals are allowed from the 7th financial year onward. Full withdrawal is permitted only after maturity.
4. Can I take a loan against my PPF account?
Yes. You can take a loan from the 3rd to the 6th financial year of your account.
5. Can NRIs invest in PPF?
No. Non-Resident Indians (NRIs) are not eligible to open a PPF account.
