A Public Provident Fund or PPF is one of the most stable and popular forms of investment in India. There are many benefits of a PPF account, importantly tax benefits and low risk exposure which make it a stable option to invest in, especially for those who are looking for long term gains. Similarly, it serves as a retirement planning tool for people who do not have a structured pension plan in place. Here are some of the salient features of a PPF.
PPF account can be opened in designated post offices, State Bank of India branches, ICICI Bank branches and branches of some nationalised banks. ICICI Bank is the first private sector bank that allows you to open an online PPF account.
An individual can open a PPF account on behalf of a minor or have a joint account. It means, a person can start saving for kids right from their birth.
Minimum limit of investing in PPF is Rs 500 and maximum is Rs 1 lakh, which needs to be invested in not more than 12 installments
If you invest in PPF, you stand to avail tax exemption under section 80C of Income Tax Act, 1961
The account gets discontinued if you have not made any deposit in a year in PPF. However, the account can be revived by paying Rs 50 for every year of discontinuation along with the arrears of subscription of Rs 500 per year
Currently, online PPF offers a rate of interest of 8.7 percent, compounded annually
PPF comes with a lock-in period of 15 years, on which the interest accrued is tax free
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It is possible to withdraw money from PPF account from 7th year onwards
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· A PPF account is also free from any kind of legal action; in case of any liability or debt incurred by the PPF account owner
Since it is a government backed investment plan for long term, the money is safe and involves no risk
A customer can extend the tenure of a PPF for a period of 5 more years beyond the maturity period by submitting ‘Form H’ within a year from the date of maturity
Customers can also avail loan facility between the third and end of the fifth financial year
One can deposit upto Rs 1 lakh in a financial year
No premature withdrawal is allowed in PPF. In case of death of the owner, their nominees can close the account by submitting requisite documents.
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ICICI Bank is the first private sector bank in India to offer PPF online. In order to convert you existing PPF to online PPF with ICICI Bank, the following steps need to be followed.
· A transfer application needs to be made at the existing bank
After the application is processed, the existing bank or post office makes necessary arrangements to send original documents etc. to ICICI Bank, as per the preferred branch address made by the customer.
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On opening a PPF account with ICICI Bank, apart from the regular benefits of a PPF account, you also have the benefit of accessing your PPF account online. Through ICICI Bank Internet banking, you can:
Fill form online for PPF account
View your PPF account under your 'My Accounts' section in the logged in section
Transfer funds from linked Savings Bank Account online
View and print mini and detailed statement online
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