PPF Withdrawal Rules: For many Indians, the Public Provident Fund (PPF) is considered the most reliable way to save for the long term. It’s not only safe, but also offers tax benefits and a fixed interest rate of 7.1% from October to December 2025. Since this is a 15-year plan, people often ask if the money can be withdrawn before the 15-year term is up. The answer is yes, but only under certain conditions.
Lock-in period
The lock-in period for a PPF account is 15 years. This means you can’t close the account and withdraw all the funds before this period is over. However, the rules aren’t so strict, as partial withdrawals are allowed after six years. Starting in the seventh financial year, you can withdraw a portion of your account if needed.
Partial Withdrawal Rules
The government has established these rules to ensure your money continues to grow and your entire deposit isn’t wiped out all at once. The maximum amount you can withdraw is the lesser of two amounts: either half the balance at the end of the fourth year of the account, or half the balance at the end of the year immediately preceding the withdrawal. This way, you can withdraw some money in case of an emergency, but the rest of your savings remains safe.
Premature closure of account
Since 2016, the government has added the option to completely close your PPF account after five years under certain circumstances. This option is only available for treatment of a serious illness or for higher education expenses for yourself or your children. If you do this, you have to face a small penalty of 1 percent reduction in interest, that is, you will get 1 percent less interest than the declared interest rate of PPF.
Loan facility against PPF
If you need money but don’t want to withdraw your savings, you can also take a loan against your PPF balance. Between the third and sixth financial years of your account, you can take a loan up to 25% of your balance. This loan is repayable within 36 months. The advantage is that your account remains active and your savings are protected.
Once your 15-year lock-in period ends, you can withdraw all your funds. If you prefer, you can also extend the account in 5-year blocks, with or without making new deposits. Many people choose this option because it keeps the money safe, earns tax-free interest, and is easily accessible when needed.
Desclaimer: For any financial invest anywhere on your own responsibility, Times Bull will not be responsible for it.
