There are going to be three major changes in the Public Provident Fund (PPF) scheme operated under the Small Savings Scheme of the Post Office. This change will come into effect from October 1, 2024 i.e. next month. A guideline has been issued by the Ministry of Finance regarding this. This should be a scheme which comes with a maturity period of 15 years and can make you a millionaire in the long term. Let us know what changes are going to happen under this scheme?
On August 21, 2024, the Department of Economic Affairs under the Union Finance Ministry has issued a guideline regarding the new rules, under which three new rules of PPF will be implemented. Apart from this, there will be changes in the rules of Sukanya Samriddhi Yojana and NSC as well. In the guideline, irregular accounts of three different cases from minor to NRI have been explained in detail for regularization.
Rule 1- PPF account opened in the name of a minor
Post Office Savings Account (POSA) interest on such irregular accounts will be paid till the person (minor) becomes eligible to open the account. That is, the person does not reach the age of 18 years, after that PPF interest rate will be paid. The maturity period will be calculated from the date on which the minor becomes an adult. That is, the date from which the person becomes eligible to open the account.
Rule 2- More than one PPF account
The primary account will earn interest as per the scheme provided the deposit amount is within the maximum limit applicable for each year. The balance in the second account will be merged with the first account provided the primary account remains within the projected investment limit each year. After the merger, the primary account will continue to earn the prevailing scheme rate or interest. Any additional account other than the primary and secondary account will earn zero percent interest rate from the date of opening the account. This means that even if more than one account is opened, PPF scheme interest will be available only on one account.
Change 3 – Extension of PPF account by NRI
Active NRI PPF accounts opened only under PPF, 1968, where Form H does not specifically ask for the residential status of the account holder. Account holders (Indian citizens who have become NRIs during the period of account opening) will be paid interest at POSA rates till 30 September 2024. Thereafter, zero interest rate will be applicable on these accounts from 1 October.
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