What is PPF
The Public Provident Fund is a government-backed savings scheme with a 15-year lock-in (extendable afterward in blocks of 5 years), a maximum contribution of ₹1.5 lakh per year, and interest that's set by the Ministry of Finance every quarter — currently 7.1% per year, unchanged since April 2020. Unlike a mutual fund or even a bank FD, PPF interest, the maturity amount, and the annual contribution deduction are all completely tax-free under the current tax regime's "EEE" (Exempt-Exempt-Exempt) treatment.
How this is calculated
PPF compounds annually, and the calculator assumes each year's contribution is made at the start of the financial year (the way to earn the most interest — PPF interest is calculated on the lowest balance between the 5th and last day of each month, so depositing early matters):
FV = P × [((1 + r)n − 1) ÷ r] × (1 + r)
where P is the yearly contribution, r is the annual PPF rate, and n is the number of years.
Frequently asked questions
Is PPF interest guaranteed like this calculator assumes?
The rate is government-notified and reviewed every quarter, so it can change — but it's backed by the government rather than market performance, which is why PPF calculators (including this one) can use a single fixed rate for the whole tenure, unlike a SIP calculator's assumed return.
What happens after the 15-year lock-in ends?
You can withdraw the full amount, or extend the account in blocks of 5 years — either continuing to contribute, or leaving it untouched to keep earning interest without adding more.
Can I invest more than ₹1.5 lakh a year?
No — ₹1.5 lakh per financial year is the maximum across all your PPF accounts combined. Anything deposited beyond that limit earns no interest and isn't eligible for the tax deduction.
PPF, next to everything else you own
Ekatra tracks your PPF and every other investment on one screen — so a 15-year lock-in doesn't mean 15 years of losing track of it. How that works →
See this next to everything else you own
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