How PPF interest is calculated
PPF interest is worked out every month on the lowest balance between the 5th and the last day of the month, and credited once a year on 31 March. In practice that means:
- Money deposited on or before 5 April earns interest for the whole year.
- Interest is compounded once a year.
The calculator assumes one deposit each year before 5 April:
What ₹1.5 lakh a year becomes at 7.1%
| Duration | Invested | Maturity value |
|---|---|---|
| 15 years | ₹22.5 lakh | ₹40.68 lakh |
| 20 years (one extension) | ₹30 lakh | ₹66.58 lakh |
| 25 years (two extensions) | ₹37.5 lakh | ₹1.03 crore |
The last years earn the most: extending from 15 to 25 years adds ₹15 lakh of deposits but more than ₹62 lakh of value.
PPF rules at a glance
| Interest rate | 7.1% a year (Oct–Dec 2026), set every quarter by the Ministry of Finance |
| Deposit | ₹500 to ₹1,50,000 per financial year, in one or more instalments |
| Term | 15 full financial years after the year of opening; extendable in blocks of 5 years, with or without new deposits |
| Tax | Deposits qualify for 80C in the old regime. Interest and maturity are tax-free in both regimes |
| Loan | From the 3rd to the 6th financial year |
| Partial withdrawal | From the 7th financial year, within limits |
| Accounts | One per person, at a post office or authorised bank. Not for NRIs to open |
PPF vs other options
PPF is a government-backed, fixed-income product with tax-free returns, which makes it a popular base for long-term savings. It's less flexible than a fixed deposit because the money is locked in for 15 years. Equity mutual funds through a SIP have historically returned more over long periods but can fall in value. Many people use both. This calculator doesn't recommend any investment.
Frequently asked questions
What is the PPF interest rate now?
How much will ₹1.5 lakh a year in PPF become?
Is PPF interest taxable?
When should I deposit in PPF to earn the most?
Can I extend my PPF account after 15 years?
Last updated . How we check our tools. Sources: Ministry of Finance, small savings rates for Oct–Dec 2026 (notified 30 Sep 2026); Public Provident Fund Scheme, 2019.