Bank of India PPF Account

Bank of India PPF Account is a long-term investment option backed by the government. It offers individuals the opportunity to build a retirement corpus or save for other long-term financial goals. With a lock-in period of 15 years, competitive interest rates, tax benefits, and withdrawal facilities, the Bank of India PPF Account is a popular choice for individuals seeking secure and tax-efficient investment avenues.

Bank of India PPF Account Interest Rate

The interest rate is determined by the Government of India and is currently set at 7.1% p.a. Interest will be added to the account after each financial year. The interest for a calendar month is calculated based on the credit balance as of the fifth day and the end of the month, whichever is lower.

Here are the interest rates and other key highlights of the Bank of India PPF account:

Interest rate 7.1% p.a.
Minimum Deposit ₹500
Maximum Deposit (per financial year) ₹1,50,000
Tenure 15 years (can be extended for 5 years at a stretch)
Tax Benefits Tax deduction under Section 80C for up to ₹1,50,000

Bank of India PPF Account Eligibility

The PPF scheme is accessible to all citizens of the country, and in specific instances, to NRIs. The essential eligibility criteria for PPF are outlined below.

  • Resident Indian individuals are eligible to open a PPF account.
  • Guardians can open the PPF account on behalf of a minor child or a person of unsound mind.
  • Non-Resident Indians (NRIs) and Hindu Undivided Families (HUFs) are not eligible to open a PPF account.

Documents Required to Open a Bank of India PPF Account

The documents required to open a Bank of India PPF account include:

  • A recent passport-size photograph is required.
  • Proof of address and identification can be provided through documents such as
    • Aadhar card, Passport, Driving license, Voter’s ID card
    • Job card issued by NREGA signed by the State Government officer
    • Letter issued by the National Population Register, and PAN Card
  • If the account is opened on behalf of a minor, proof of the minor's age is necessary.
  • If the account is opened on behalf of a person of unsound mind, a certificate from the Superintendent of the Mental hospital where the person is confined or treated is required.

Note: PAN card must be submitted within six months if not provided at the time of account opening.

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How To Open Bank of India PPF Account

Bank of India PPF Account opening is available at all BOI branches.

  • Applicants can download the PPF Account Opening Form and apply to the branch.
  • Additionally, applicants acting as guardians can open accounts on behalf of minors or persons of unsound mind.

How to Deposit Money in a Bank of India PPF Account?

Bank of India offers the convenience of both online and offline methods to deposit money in the PPF accounts.

Online Mode: You can deposit money and manage your PPF account online by using your active Net Banking.

Offline Mode:

  • Fill out and submit Form B, providing details such as branch name, subscriber's name, PPF account number, deposit amount, currency denominations or cheque/DD number and date, bank/branch on which it is drawn, and depositor's signature.
  • Once all details are filled, submit the form at the bank branch along with the deposit amount.

Features of Bank of India PPF Account

The Bank of India offers PPF accounts with various features and benefits that include:

  • Tax Benefits: Investments up to ₹1.5 Lacs in PPF are tax deductible under Section 80C of the Income Tax Act. The accrued interest and maturity amount is tax-exempt.
  • Loan Facility: Loans against PPF deposits are available from the 3rd to 5th year, up to 25% of the amount deposited at the end of the last financial year, repayable over 36 months.
  • After Maturity: Account holders can retain the account after maturity without making further deposits, with the balance continuing to earn interest at the normal rate until closure.
  • Transferability: PPF accounts are fully transferable among branches, banks, and post offices.
  • Investment Amount: Minimum deposit: ₹500, maximum: ₹1,50,000 per financial year. Deposits can be made in lump sum or installments in multiples of ₹100, with a minimum of ₹500 per year.
  • Mode of Investment: PPF deposits can be made through all BOI Branches and BOI Internet Banking.
  • Nomination: Nomination is mandatory, with a maximum of 4 nominees now allowed.
  • Period: The account duration is 15 years, extendable for 5 years at a time indefinitely. Discontinued accounts can be revived during the operating period by paying a penalty of ₹50 and arrears of deposit of ₹500 for each defaulted year.

How to Transfer Bank of India PPF Accountn

You can transfer your existing PPF account from one authorized bank or Post office to another, and in such a case, the PPF account will be considered as a continuing account.
To transfer your PPF account to the Bank of India, you can follow the steps mentioned below:

  1. Submit a PPF transfer request with the original passbook at the current bank or post office where the PPF account is held.
  2. The current bank/post office will then send the original documents and a cheque/DD of the outstanding balance to the specified Bank of India branch address.
  3. Upon receipt of the transfer documents, the Bank of India branch will inform you.
  4. You can then submit a new PPF account opening form, Nomination form, and a fresh set of KYC documents.

Premature Closure of Bank of India PPF Account

Premature Closure Eligibility:

Account holders can apply for premature closure using Form-5 on the following grounds:

  • Treatment of life-threatening disease of the account holder, spouse, dependent children, or parents with supporting medical documents..
  • Higher education of the account holder or dependent children in a recognized institute in India or abroad with confirmation of admission and fee bills.
  • Change in residency status of the account holder with a copy of Passport and visa or Income-tax return (not applicable for PPF accounts opened before 12th December 2019).
  • Premature closure is not allowed before five years from the end of the year in which the account was opened.

Interest in Premature Closure:

Upon premature closure, the interest in the account will be allowed at a rate lower by one percent than the rate at which interest has been credited to the account since its opening or extension.

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Frequently Asked Questions

PPF stands for Public Provident Fund, a long-term investment option with tax benefits, competitive interest rates, and a lock-in period of 15 years.

Resident Indian individuals can open a PPF account with the Bank of India.

No, joint PPF accounts are not permitted.

The minimum deposit required to open a PPF account with the Bank of India is ₹500.

Yes, the maximum deposit limit in a PPF account is ₹1,50,000 per financial year.

Partial withdrawals and loans against the PPF balance are allowed after a specified period, offering some flexibility.

Yes, the interest earned and the maturity amount are both tax-free.

Yes, you can transfer your PPF account from one bank to another, including Bank of India.

Yes, the PPF account's tenure can be extended in blocks of 5 years after maturity.

Premature closure penalties include lower interest rates and restrictions on closure before the completion of five years.

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