PPF Interest Rate Unchanged at 7.10% for July-September 2026 Quarter

Small savings schemes, including the Public Provident Fund (PPF), go through quarterly interest rate review. For the July-September 2026 quarter, the Finance Minister announced interest rates of all small savings schemes, including that of the PPF, on June 30. Has the ministry changed the PPF interest rate in its quarterly review meeting?

The Finance Ministry has not changed the PPF interest rate for the July-September 2026 quarter. The PPF still offers an interest rate of 7.10% for the July-September quarter.

"The rates of interest on various Small Savings Schemes for the second quarter of FY 2026-27, starting from July 1, 2026, and ending on September 30, 2026, shall remain unchanged from those notified for the first quarter (March 1, 2026, to June 30, 2026) of FY 2026-27," the Finance Ministry said in a notification.

The PPF scheme comes with a 15-year lock-in period and provides tax-free returns, making it a popular long-term investment option.

Additionally, investments made in the PPF are eligible for a tax deduction of up to Rs 1.5 lakh under Section 80C of the Income Tax Act, 1961. This deduction is applicable to the PPF investors following the old tax regime.

Key features of the PPF scheme

Any resident individual can open a PPF scheme account. However, an individual can open only one PPF scheme account. The account can be opened in different banks or post offices. If multiple PPF accounts are opened, one may have to be closed or merged.

The scheme rule allows an individual to deposit a minimum of Rs 500 and a maximum of Rs 1.5 lakh in a financial year. Investors should make a minimum deposit every year to ensure that the PPF account remains active. A deactivated account can be reactivated by paying Rs 500 for each missed year and a penalty of Rs 50 per year.

Tax benefits of PPF

Investments in a PPF account qualify for a tax deduction under Section 80C of the Income Tax Act, 1961. The interest in the PPF account is compounded annually and credited to the linked account at the end of each fiscal year.

PPF falls under the EEE (Exempt-Exempt-Exempt) category, meaning:

Contributions are tax-deductible (under Section 80C).

Interest earned is tax-free.

The maturity amount is completely tax-free.

Partial withdrawals are allowed from the 7th financial year onwards. There is no tax on partial withdrawals.

PPF maturity: Can you extend the PPF account beyond 15 years?

The PPF account matures 15 years after the end of the financial year in which it was opened. However, once a PPF account has matured, it can be extended indefinitely in 5-year blocks. After 15 years, you can decide whether or not to continue contributing. If you continue to deposit money into your PPF account, you will earn interest on both existing and new deposits.

Partial withdrawal rules from PPF

The PPF is often thought of as a locked-in investment, but partial withdrawals are available, beginning with the seventh fiscal year. The amount you can withdraw is the lesser of the 50% of the balance at the end of the fourth year and the preceding year's balance. Withdrawals can be used for emergency, educational, or medical purposes.