PPF (Public Provident Fund)
A long-term, government-backed savings scheme with a 15-year lock-in, tax-free interest, and 80C eligibility, open to any resident individual.
PPF is a government-backed savings scheme open to any resident individual, not tied to employment the way EPF is, with a 15-year lock-in period, extendable in blocks of five years after maturity. Interest is set quarterly by the government, and both the interest earned and the maturity amount are entirely tax-free, alongside the contribution itself qualifying for Section 80C deduction up to the overall ₹1.5 lakh cap, making it one of the few genuinely 'triple tax-exempt' instruments available.
Annual contributions are capped, currently ₹1.5 lakh per financial year, and partial withdrawals are allowed only after a specified number of years, with loan facilities available even earlier under specific conditions. The long lock-in is the main tradeoff for its tax treatment and government backing, so it suits long-term goals like retirement more than money that might be needed on shorter notice.
This glossary entry is for general informational purposes only and does not constitute professional tax, legal, or financial advice. Rules and rates change, so consult a qualified Chartered Accountant for advice specific to your situation.