KEY POINTS OF PUBLIC PROVIDENT FUND
Initial Subscription: Every individual shall apply in Form A together with the amount of initial subscription which shall be minimum of Rs.100.
Limit of subscription:Any individual may, on his own behalf or on behalf of a minor of whom he is the guardian, subscribe to the Public Provident Fund any amount not less than Rs. 500 and not more than Rs. 1,50,000 in a year.
Interest:- Interest at the rate, notified by the Central Government in the official gazette from time to time, shall be allowed for a calendar month on the lowest balance at credit of an account between the close of the fifth day and the end of the month and shall be credited to the account at the end of each year.
Transfer of Account:- A subscriber may apply for transfer of his account from one “Accounts Office” to another “Accounts Office”.
‘Accounts Office’ means an office or branch of all public sector banks and ICICI Bank, Axis Bank and HDFC Bank Ltd. and any other office authorised by the Central Government to receive subscriptions under the Scheme;
Withdrawals from the Fund:- Any time after the expiry of five years from the end of the year in which the initial subscription was made, a subscriber may, if he so desires, apply in Form C, an amount not exceeding 50% of the amount that stood to his credit at the end of the fourth year immediately preceding the year of withdrawal or at the end of the preceding year, whichever is lower, less the amount of loan, if any.
Provided that not more than one withdrawal shall be permissible during any one year.
Maturity Period: After the expiry of 15 years from the end of the year in which the initial subscription was made by individual.
Continuation of account with deposits after maturity:- a subscriber may, on the expiry of 15 years from the end of the year in which the initial subscription was made but before the expiry of one year thereafter, may exercise an option with the Accounts Office in Form H, or as near thereto as possible, that he would continue to subscribe for a further block period of 5 years
Loans: –a subscriber may, any time after the expiry of one year from the end of the year in which the initial subscription was made but before expiry of five years from the end of the year in which the initial subscription was made, if he so desires, apply in Form D, together with his passbook to the Accounts Office for obtaining a loan consisting of a sum of whole rupees not exceeding 25% of amount that stood to his credit at the end of the second year immediately preceding the year in which the loan is applied for.
Note: A subscriber shall not be entitled to get a fresh loan so long as earlier loan has not been repaid in full together with interest thereon.
Repayment of loan and interest:- Repayment before the expiry of 36 months from the first day of the month following the month in which the loan is sanctioned.
After the principal of the loan is fully repaid, the subscriber shall pay interest thereon in not more than two monthly installments at the rate of two per cent per annum of the principal for the period commencing from the first day of the month following the month in which the loan is drawn upto the last day of the month in which the last installment of the loan is repaid.
Provided that where the loan is not or is repaid only in part within the prescribed period of thirty six months, interest on the amount of loan outstanding shall be charged at six per cent per annum.
Nominee: – A subscriber to the Fund may nominate in Form G, one or more persons to receive the amount standing to his credit in the event of his death before the amount has become payable or, having become payable, has not been paid.
Note: Non-Resident Indians are not eligible to open an account under the Public Provident Fund Scheme.
Provided that if a resident, who subsequently becomes Non Resident Indian during the currency of the maturity period prescribed under Public Provident Fund Scheme, may continue to subscribe to the Fund till its maturity on a Non Repatriation Basis.
