Public Provident Fund (PPF) is one of the most popular saving schemes among Indian households. Since it is managed by the Central Government, the money in the PPF account and the returns it generates, are guaranteed. The maturity period of PPF is of 15 years.
Here are few things you need to know if you have also invested in PPF.
Conditions if you want to close the PPF account before maturity
- In case of life-threatening disease: PPF account holder can withdraw the complete amount if the account holder, its life partner, or any of the dependents (parents or children) faces a life-threatening disease. The PPF account closure is also allowed in case the account holder needs money for higher studies for himself or his children.
- For higher studies of the PPF account holder or its children: An account can also be closed for the higher education of the account holder, or dependent children on the production of documents and fee bills in confirmation of admission in a recognised institute of higher education in India or abroad.
- On change in residency status of the account holder: The account holder will have to provide a copy of Passport and visa or Income-tax return provided that an account under this scheme shall not be closed before the expiry of five years from the end of the year in which the account was.
- On the death of the account holder
On such premature closure, interest in the account shall be allowed at a rate which shall be lower by one percent than the rate at which interest has been credited in the account from time to time since the date of opening of the account, or the date of extension of the account, as the case may be.
Here's how to close the PPF account if the account holder dies
The nominee can withdraw the money if the account holder dies before the maturity of the PPF account. Also, the condition of completing 5 years of the account gets rejected in such a situation. It means the PPF account is closed after the death of the account holder. The money is given to the nominee or legal heir. The same account is not allowed to continue.
Who can open a PPF account?
Anyone having Indian citizenship can open an account. The account can also be opened in the name of a minor. It can be opened with a minimum initial deposit of Rs 500 and thereafter deposit of any sum in multiples of Rs 50 can be made.
