Why you should invest in PPF | Fusion - WeRIndia

Why you should invest in PPF

Why you should invest in PPF

There are many government-backed investment schemes out there, and every one of them has its various advantages and disadvantages. Public Provident Funds (or PPF) is no exception to this. Since it is backed by the government, it is a safe scheme, and one can be well-assured that the deposited money will be safely kept.

PPF holds a good position concerning its lock-in period, risk, rate of interest, and tax exemptions. Considering these things, it is one of the best among all small saving investment options in India. These are six advantages of choosing Public Provident Funds.

There is no specific eligibility required for opening up a PPF account. A PPF account can be opened by any Indian citizen, regardless of age or income class, at any bank or post office in India. However, non-resident Indians (or NRIs) cannot open a PPF account in India.

A PPF account has a substantial lock-in period of 15 years. Money cannot be withdrawn within this time period, which gives a large amount of time for money to grow.


This adds a great deal of financial security to PPF account deposits. However, in times of financial crisis, certain amounts of money can be withdrawn.

It is very easy to open a PPF account, since it only requires an initial deposit of ₹100. This, combined with the lack of eligibility required to open a PPF account, makes this a very accessible option.

A PPF account allows for several tax exemptions. There is a tax deduction under section 80C. The maturity amount, including its interest, cannot be taxed. Lastly, a PPF account is also exempt from wealth taxes.

Since a PPF account can be opened regardless of age, minors can open a PPF account.

Parents who want a secure investment can open a PPF account for their children, in order to save money for later payments. These child accounts receive all of the benefits of a PPF account, such as the financial security and tax exemptions.

From the third year onwards, loans can be taken out against a PPF account. However, loans can only be taken out until the sixth year.

Image by Pete Linforth from Pixabay (Free for commercial use)


Image Reference: https://pixabay.com/fr/illustrations/investir-finances-%C3%A9conomie-1714373/

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