Investment Guide

PPF Guide India 2026 — Interest Rate, Rules, Tax Benefits

📅 March 2026⏱ 7 min read

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PPF Key Facts 2026

FeatureDetails
Current Interest Rate7.1% p.a. (compounded annually)
Minimum InvestmentRs.500/year
Maximum InvestmentRs.1,50,000/year
Lock-in Period15 years (extendable)
Partial WithdrawalAllowed from 7th year
Tax StatusEEE — Exempt, Exempt, Exempt

EEE Tax Status — What It Means

  • E1 — Exempt at investment: Rs.1.5 lakh deductible under Section 80C (old regime only)
  • E2 — Exempt interest: 7.1% interest is completely tax-free
  • E3 — Exempt at maturity: Full maturity amount is tax-free

💡 Compare: FD interest is fully taxable at slab rate. At 30% slab, 7.1% FD gives effective 4.97%. PPF 7.1% gives full 7.1% — making PPF significantly better than FD for high-income earners.

PPF vs SIP vs FD (15-year comparison, Rs.1.5 lakh/year)

  • PPF @ 7.1%: ~Rs.40.68 lakh (tax-free)
  • FD @ 7.0%: ~Rs.37 lakh (taxable each year)
  • Equity SIP @ 12%: ~Rs.75 lakh (LTCG tax above Rs.1L)

PPF wins over FD for tax efficiency. Equity SIP wins for long-term wealth — but with market risk. Use PPF as the safe, stable part of your portfolio.

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