PPF: 15-Year Lock-in, Partial Withdrawal, Extension, Loan

The safest investment in India. Government guarantee. Tax-free interest. EEE status, exempt at investment, exempt during growth, exempt at maturity. But the 15-year lock-in confuses most investors, partial withdrawals, extensions, and loans are available but have specific rules.

Why April 5 matters: PPF calculates interest on MINIMUM balance between 5th and last day of each month. If you deposit ₹1.5L on April 1-5, it earns interest for all 12 months (April through March). If you deposit on April 6-30, you earn interest for only 11 months (May through March). On ₹1.5L at 7.1%, depositing after April 5 costs: ₹1.5L × 7.1% ÷ 12 = ₹888 in lost interest per year. 15-year calculation, when does it actually mature: First deposit: July 2010 (FY 2010-11). Maturity: end of FY 2024-25 = March 31, 2025 (15 full FYs from 2010-11). Common mistake: counting 15 calendar years from deposit date. It's 15 financial years from the FY of first deposit. Partial withdrawal rules (from Year 7): Withdrawal available from Year 7 of account. In year 7 (2024-25 if started 2009-10): withdraw up to 50% of balance at end of Year 4 (2013-14) or Year 6 (2018-19), whichever is lower.