PPF stands for Public Provident Fund. It’s a popular savings scheme backed by the Indian government. It’s safe, gives good returns, and helps save tax too.
One of the most important things to know about PPF is the interest rate. This tells you how much extra money your savings will earn over time.
What is the Current PPF Interest Rate in 2025?
As of July–September 2025, the PPF interest rate is 7.1% per year.
This means if you keep ₹1,000 in your PPF account, you will earn ₹71 as interest every year.
The interest is calculated monthly but added to your account at the end of every financial year (March 31st).
Who Decides the PPF Interest Rate?
The Government of India decides the PPF rate. It reviews and updates it every three months (quarterly). The Ministry of Finance announces the new rate at the beginning of each quarter.
Is the Interest Rate Always the Same?
No. The rate changes based on how the economy is doing. But even if the rate changes, the money in your PPF account is 100% safe.
Here are some recent PPF interest rates for comparison:
- Jan–Mar 2025: 7.1%
- Oct–Dec 2024: 7.1%
- Jul–Sep 2024: 7.1%
As you can see, the rate has stayed steady for a while, but it could change in the future.
Why is PPF a Good Investment?
- Safe and Secure – Backed by the government.
- Good Interest Rate – Better than most savings accounts.
- Tax-Free Returns – You don’t pay tax on the interest earned.
- Helps Save Taxes – You can claim up to ₹1.5 lakh under Section 80C.
Who Can Open a PPF Account?
- Any Indian citizen
- You can open it in your own name or your child’s name
- Minimum deposit: ₹500 per year
- Maximum deposit: ₹1.5 lakh per year
Real-Life Example
Suppose Anjali deposits ₹1.5 lakh every year into her PPF account. At 7.1% interest, after 15 years she will have around ₹40 lakh. And the best part? All of it is tax-free.
Tip for Maximum Interest
To earn the most interest, deposit your money before the 5th of each month. This way, you get interest for the full month.
