New Delhi: The Ministry of Finance’s Department of Economic Affairs has introduced new guidelines for Public Provident Fund (PPF) accounts, particularly those opened for minors, multiple PPF accounts, and PPF accounts held by Non-Resident Indians (NRIs). These changes, outlined in a circular released on August 21, 2024, will take effect from October 1, 2024.
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PPF Accounts For Minors
For PPF accounts opened in the name of minors, the new rules specify that the account will earn interest at the Post Office Savings Account (POSA) rate until the minor turns 18 years old, which is the age at which they become eligible to open a PPF account themselves. The maturity period of the account will also be calculated from the date the minor reaches adulthood.
Multiple PPF Accounts
In cases where an individual has more than one PPF account, the primary account—chosen by the investor from any Post Office or agency bank—will continue to earn the scheme’s interest rate, provided the deposits remain within the annual investment ceiling. The balance from any secondary PPF account will be merged with the primary account, ensuring that the primary account stays within the investment limit each year. If the balance in the secondary account exceeds this limit, the excess amount will be refunded at a zero percent interest rate. All other additional PPF accounts beyond the primary and secondary ones will not earn any interest from the day they were opened.
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PPF Accounts Held by NRIs
NRIs who opened PPF accounts under the Public Provident Fund Scheme, 1968, and whose Form H did not ask for their residency status, will receive interest at the POSA rate until September 30, 2024. After this date, these accounts will not earn any interest.
