How to Start Contributing to Your PPF Account

6 mins read
by Angel One

As citizens of the country, one is required to pay tax on the income one earns. For some, this income tax is charged on the income they earn from their business endeavours and investments, and others are required to pay this tax on the salary they receive. However, alongside having mentioned various tax brackets for individuals based on their income, the Income Tax department has also fashioned out a number of avenues for individuals to be able to save their taxes, as well as invest in their future. A prime example of a facility of this kind provided under section 80C of the IT act is a PPF account. In this article, we will have a look at what a PPF account is, how you can start contributing to your PPF account, as well as how to open a PPF account online and the various PPF interest rates.

What is a PPF account?

A Public Provident Fund, or PPF account, is a facility provided to Indian citizens through various banks, which helps facilitate saving, whilst simultaneously promoting it through incentives such as tax-free interest rates and the stability that comes with investing in a government-backed fund.

As part of opening a PPF account, individuals can invest up to 1.5 lakhs per annum of their income into the fund, and any interest earned on this amount is tax-free. One thing to keep in mind is the fact that a PPF is an investment opportunity that is long term in nature. Subsequently, it has a lock-in period of 15 years. Post this, individuals can either claim their returns from the fund (which might be subject to capital gains taxes) or can choose to further extend the term of their fund.

How to start investing in your PPF account.

One of the first steps towards contributing to your PPF fund, before looking to things like your PPF interest rate, is to open a PPF account. Given that the investment opportunity is government-backed, it is offered at most post offices or banks. Individuals can open a PPF account online as well as offline.

1. Opening a PPF account online.

One can open a PPF account online by visiting the portal of the individual’s bank of choice. In order to open a PPF account, one must first have a savings account with the bank. Once this is completed, you can visit the online portal of the bank to open the PPF account. You will be required to fill in certain details such as the name of the nominee, as well as verify your PAN card details.

2. Opening a PPF account offline.

In order to open a PPF account offline, you can visit a branch of the bank of your choice. In the case of post offices, given that the online account opening features are yet to be introduced, PPF accounts with post offices can only be opened offline for the time being. You can get the form for a PPF account from the bank or post office, and it can be submitted along with the required KYC documents.

How to invest in your PPF account

Now that you have opened a PPF account, you are likely to want to figure out how to contribute to your PPF account. Before doing this, however, you must first ascertain the PPF interest rates you are getting. This can be done through a PPF calculator. Similar to opening a PPF account online or offline, one can choose between the two options while investing as well. Let’s have a look at how you can contribute to your PPF account online and offline.

1. Investing in PPF online.

The process of investing in your PPF account is similar to making routine payments or transfers. As per the terms of PPF accounts, you are allowed to invest upto 1.5 lakhs per annum into the PPF account, which can be done in the form of routine transfers. One can employ a simple funds transfer process to start contributing to their PPF account.

In order to start investing in your PPF account online, you must first add the fund as a beneficiary through the net banking portal of your bank. Once you have done this, you can start making routine investments in your PPF account online, based on your investment capability.

Investing in a PPF account online also offers the added advantage of being able to automate your payments. While you can invest into your PPF account through net banking or mobile banking, it is also possible to automate your payments, ensuring that a certain amount is invested into your PPF account on a routine basis.

2. Investing in a PPF offline.

While investing in your PPF account through online channels offers a number of advantages in the form of increased speed and 24/7 accessibility, alongside additional tools like a PPF calculator that could help you calculate the PPF interest rate you would get, for instance, some still prefer to use the offline mode and physically make their contributions to their PPF account.

In order to contribute one’s PPF account offline, one can employ a number of methods through which one can deposit money into their PPF account. Cash, Cheques and demand drafts are all accepted modes of payment.


Contributing to your PPF account can be a task that might not appear as lucrative in the short run, though it offers exponentially higher payoffs in the long run. In order to start contributing to your PPF account online or offline, and in order to maximise your returns, there are a number of things you can keep in mind. Experts recommend making your deposit before the 5th of every month. Additionally, given that interest rates are calculated from April to march, investing a lump sum money at the beginning of the year can allow you to earn and maximise your returns for that year. However, if you do not have the spending capacity to make that lump sum transaction, it is good practice to ensure you deposit routine amounts into the account, regardless of the amount itself.