: The Public Provident Fund (PPF) is among the most reliable long-term savings options in India, offering guaranteed returns along with attractive tax benefits. It is a popular choice for individuals planning for retirement or long-term financial goals. However, despite its popularity, there is still confusion among many investors regarding the rules around maintaining multiple PPF accounts.
A frequently asked question is: Can a person legally hold more than one PPF account? And what happens if a second account is opened by mistake? In this article, we will guide you through all the common questions that may come to mind.
PPF New Rules: One Account Per Person
According to government guidelines, an individual is allowed to hold only one PPF account in their name, as per the Public Provident Fund Act, 1968. Opening another account—regardless of whether it’s in a different bank or post office—is considered a violation of rules. If a second account is created, it is deemed invalid. While the principal amount is refunded, no interest is paid on the balance.
PPF New Rules: Accounts for Minor Children Are Permitted
While multiple accounts in one’s own name are prohibited, individuals are allowed to open a PPF account on behalf of a minor child. In such cases, the parent or guardian manages the account. However, there is a cap—the combined annual deposit across both accounts (parent and child) cannot exceed ₹1.5 lakh. For example, if ₹1 lakh is deposited in the parent’s account, only ₹50,000 can be added to the child’s account during the same financial year.
PPF New Rules: No Joint Accounts
PPF accounts are strictly individual. Joint accounts are not permitted—not even between spouses or between a parent and a child. Even in the case of a minor’s account, only the child’s name appears officially, while the guardian oversees its operation.
PPF New Rules: What If You Open Second Account By Mistake?
If you have mistakenly opened a second PPF account, it is advised to notify your bank or post office immediately. In most cases, the second account will be closed, and the amount refunded—but without any accrued interest.
PPF New Rules: Can NRIs hold PPF accounts?
Non-Resident Indians (NRIs) are not allowed to open new PPF accounts. However, if a person opened a PPF account when they were a resident and later became an NRI, they are allowed to continue contributing until maturity (15 years), but cannot extend it beyond that period.
PPF Interest Rate For FY 2024-2025
Currently offering an interest rate of 7.10 per cent per annum (subject to periodic revision) for FY 2024-2025, PPF continues to be a tax-exempt and low-risk savings tool. It enjoys EEE (Exempt-Exempt-Exempt) status, meaning contributions, interest, and maturity proceeds are all tax-free. The default tenure is 15 years, with the option to extend in blocks of five years. Investors can contribute between Rs 500 and Rs 1.5 lakh annually.
