In December last year, the government made some changes in the way of small savings deposits. In the phase of this change, some procedural changes were made to the rules of the PPF scheme. In this news, we are giving information about five such changes, which you should also know about.
PPF contribution The minimum and maximum contribution that can be made to a PPF account are without change, but the minimum amount required to open a PPF account has been replaced with the number of contributions to be made in a financial year. Also, the contribution amount should be in multiples of Rs 50 and should be equal to Rs 500 or more, but should not exceed Rs 1.5 lakh. Apart from this, more than one contribution can be made in a PPF account in a month.
New form To open a PPF account, now you have to submit Form 1 instead of Form A, which was used earlier. For extension of PPF account (with deposit), an application has to be submitted one year before maturity in Form-4 instead of Form H after 15 years, which was used earlier.
PPF account extension without deposit If you are choosing to extend your PPF account after a maturity period of 15 years without any further contribution, you can withdraw once every financial year.
PPF loan interest rate The interest rate on loans taken against PPF balance has been reduced from 2% to 1%. Once you repay the principal amount of the loan, you will have to repay the loan interest in more than two installments. Interest will be calculated from the first day of the month in which you take the loan till the last day of the month in which the last installment of the loan principal is paid.
Loan amount You can take a loan of up to 25% of the PPF balance available in the account two years before the year the loan is being applied.
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