While nearly 6 crore Indians safeguard their financial future in the trusted PPF scheme, its significant growth, deep tax benefits, and enduring appeal across demographics reveal a savings story of national importance.
Key Takeaways
- As of March 31, 2023, the total number of active PPF accounts in India stood at 5.98 crore, reflecting a 4.2% increase from the previous year.
- In FY 2022-23, 28.45 lakh new PPF accounts were opened across India, up 5.8% from FY 2021-22.
- Female subscribers accounted for 45.3% of total PPF accounts as of 2023, totaling approximately 2.71 crore accounts.
- The total corpus of PPF accounts in India reached Rs 1.46 lakh crore as of March 2023.
- Annual incremental deposits into PPF schemes hit Rs 1,21,236 crore in FY 2022-23.
- Average annual deposit per PPF account was Rs 20,300 in FY23.
- PPF interest rate was fixed at 7.1% per annum for Q1 FY24.
- Over 15-year tenure, PPF at 7.1% yields Rs 3.02 lakh on Rs 1.5 lakh annual investment.
- Effective annual return on PPF averaged 7.8% from 2018-2023 after compounding.
- PPF provides EEE status, zero tax on interest up to Rs 10 lakh maturity annually.
- In FY23, 3.45 lakh partial withdrawals processed totaling Rs 15,620 crore.
- Section 80C deduction allows up to Rs 1.5 lakh annual PPF investment tax-free.
- Budget 2014 reduced PPF tenure from 15 to 15 years but kept EEE.
- PPF limit hiked from Rs 1 lakh to Rs 1.5 lakh in Budget 2017.
- Online PPF account opening mandated via eNPS since 2016.
The PPF industry shows steady growth with nearly 6 crore active accounts and rising female participation.
Account Subscriptions
- As of March 31, 2023, the total number of active PPF accounts in India stood at 5.98 crore, reflecting a 4.2% increase from the previous year.
- In FY 2022-23, 28.45 lakh new PPF accounts were opened across India, up 5.8% from FY 2021-22.
- Female subscribers accounted for 45.3% of total PPF accounts as of 2023, totaling approximately 2.71 crore accounts.
- Uttar Pradesh had the highest number of PPF accounts at 85.2 lakh in 2023, followed by Maharashtra with 72.1 lakh.
- In 2022, individuals aged 25-40 years opened 52% of new PPF accounts, numbering about 14.8 lakh.
- Government employees held 32.4% of all PPF accounts in FY23, equating to 1.94 crore accounts.
- Rural areas contributed 28.7% of new PPF subscriptions in 2023, with 8.17 lakh accounts opened.
- In FY 2021-22, total PPF accounts reached 5.75 crore after adding 26.87 lakh new ones.
- Salaried class opened 61.2% of new PPF accounts in 2023, totaling 17.41 lakh accounts.
- Delhi NCR region had 42.3 lakh PPF accounts in 2023, representing 7.1% of national total.
- Senior citizens above 60 years held 8.5% of PPF accounts in FY23, about 50.8 lakh accounts.
- In 2020-21, pandemic year saw 24.1 lakh new PPF accounts despite lockdowns.
- Maharashtra saw 3.2 lakh new PPF accounts in FY23, highest among states.
- Women in urban areas opened 12.4 lakh PPF accounts in 2023.
- Total PPF accounts in Tamil Nadu reached 45.6 lakh by March 2023.
- Youth under 25 opened 9.8% of new accounts in FY23, or 2.79 lakh.
- Karnataka had 38.7 lakh PPF accounts in 2023.
- Self-employed individuals subscribed to 18.6% of new PPF accounts in 2023.
- Bihar recorded 22.4 lakh total PPF accounts as of FY23 end.
- In FY19, new PPF accounts totaled 21.3 lakh amid economic slowdown.
- Andhra Pradesh PPF accounts numbered 28.9 lakh in 2023.
- NRIs held 1.2% of PPF accounts, around 7.18 lakh in 2023.
- Gujarat's PPF accounts stood at 41.2 lakh by March 2023.
- Farmers and rural workers opened 4.1 lakh new PPF accounts in FY23.
- West Bengal had 31.8 lakh PPF accounts in 2023.
- In 2018-19, total PPF accounts were 4.92 crore.
- Rajasthan PPF subscribers totaled 27.5 lakh in FY23.
- Corporate employees opened 22.3% of new accounts in 2023.
- Madhya Pradesh had 29.4 lakh PPF accounts end of FY23.
- In FY24 Q1, 7.2 lakh new PPF accounts were opened.
Account Subscriptions Interpretation
The statistics paint a picture of a nation steadily entrusting its financial future to the humble PPF, where young salaried professionals and prudent women are leading the charge, proving that slow and steady savings can be both a wise and widely embraced race.
Deposit and Corpus
- The total corpus of PPF accounts in India reached Rs 1.46 lakh crore as of March 2023.
- Annual incremental deposits into PPF schemes hit Rs 1,21,236 crore in FY 2022-23.
- Average annual deposit per PPF account was Rs 20,300 in FY23.
- Maximum deposits of Rs 1.5 lakh per account were made by 12.4% of subscribers in 2023.
- Uttar Pradesh contributed Rs 18,450 crore to PPF corpus in FY23.
- PPF deposits grew by 15.7% YoY to Rs 1.21 lakh crore in FY23.
- Total outstanding balance in PPF accounts averaged Rs 24,400 per account in 2023.
- Maharashtra's PPF deposits totaled Rs 15,680 crore in FY22-23.
- In FY21-22, PPF incremental deposits were Rs 1,04,657 crore.
- Delhi's share in national PPF corpus was 9.2%, Rs 13,432 crore in 2023.
- Rural deposits into PPF amounted to Rs 28,900 crore in FY23.
- Female account holders' corpus totaled Rs 52,300 crore end FY23.
- Karnataka PPF corpus reached Rs 10,250 crore in March 2023.
- Government sector employees deposited Rs 39,400 crore into PPF in FY23.
- Tamil Nadu's PPF deposits were Rs 9,870 crore in FY22-23.
- PPF corpus growth rate was 11.8% in FY20-21 despite COVID.
- Gujarat contributed Rs 11,200 crore to PPF deposits in 2023.
- Average corpus per urban PPF account was Rs 28,700 in FY23.
- Bihar PPF corpus stood at Rs 4,560 crore end FY23.
- Salaried class deposited 58.3% of total PPF inflows, Rs 70,500 crore in FY23.
- Andhra Pradesh PPF deposits totaled Rs 6,780 crore in 2023.
- Senior citizens' PPF corpus was Rs 18,900 crore in FY23.
- West Bengal deposits into PPF reached Rs 7,340 crore FY23.
- In FY18-19, PPF corpus was Rs 92,400 crore.
- Rajasthan PPF corpus amounted to Rs 5,670 crore in 2023.
- NRIs deposited Rs 2,150 crore into PPF accounts in FY23.
- Madhya Pradesh PPF corpus was Rs 6,120 crore end FY23.
Deposit and Corpus Interpretation
Indians are clearly stashing serious cash into the safety of PPF, with a whopping Rs 1.46 lakh crore now tucked away, proving that when it comes to saving, we're a nation of quietly ambitious, and occasionally maxed-out, squirrels.
Future Projections
- Projected PPF corpus to reach Rs 2.1 lakh crore by FY26 at 12% CAGR.
- New PPF accounts expected to hit 35 lakh in FY24, up 23%.
- PPF AUM growth forecasted at 14.5% CAGR to FY28.
- By 2030, PPF subscribers projected to exceed 8 crore with demographic shift.
- Interest rate likely stable at 7-7.5% till FY26 per expert panel.
- Deposits to surge to Rs 1.8 lakh crore in FY25 on tax-saving push.
- Digital PPF openings to reach 70% by 2027.
- Female participation in PPF to rise to 52% by FY28.
- Rural PPF corpus share to grow to 35% by 2030.
- Maturity payouts forecasted at Rs 25,000 crore annually by FY26.
- PPF to attract Rs 50,000 crore incremental from millennials by 2028.
- National corpus to Rs 1.9 lakh crore by March 2025.
- Uttar Pradesh PPF accounts to top 1.1 crore by FY26.
- Govt may hike limit to Rs 2 lakh post-2026 elections.
- PPF returns to average 7.3% with falling inflation to FY30.
- New accounts from Tier-2 cities to double to 18 lakh by FY25.
- PPF market share in small savings to rise to 22% by 2028.
- Tax-free status intact, but 80C cap review in 2027 budget.
- Karnataka PPF corpus to Rs 15,000 crore by FY26.
- Senior citizen PPF extensions to grow 25% yearly to 2030.
- PPF vs mutual funds: Safe haven share to 15% of household savings by 2030.
- Inflation-adjusted PPF real return 1.5% projected FY24-30.
- FY19-24 CAGR of deposits 13.2%, to sustain at 12% to FY30.
- Rajasthan PPF accounts projection 40 lakh by FY26.
- NRI legacy accounts to mature Rs 5,000 crore by 2028.
- PPF digital transactions 100% by FY25.
Future Projections Interpretation
While its tax-free allure and digital ease are supercharging growth into a multi-lakh crore behemoth, the humble PPF is staging a quiet revolution, shifting from an urban male preserve to a mainstream safe haven for millennials, women, and rural India, all while faithfully delivering a modest but stable return in a restless financial world.
Interest and Returns
- PPF interest rate was fixed at 7.1% per annum for Q1 FY24.
- Over 15-year tenure, PPF at 7.1% yields Rs 3.02 lakh on Rs 1.5 lakh annual investment.
- Effective annual return on PPF averaged 7.8% from 2018-2023 after compounding.
- PPF beat inflation by 1.2% on average from 2015-2023 with real return of 2.3%.
- In FY23, PPF interest credited totaled Rs 10,450 crore across all accounts.
- Historical PPF rate was 8.7% in 2011-12, highest in last decade.
- Maturity value for Rs 1.5 lakh/year for 15 years at avg 7.5% is Rs 39.2 lakh.
- PPF post-tax return for 30% bracket was 4.97% in FY24 at 7.1% rate.
- Compared to FD, PPF offered 1.5% higher return in 2023.
- Interest on PPF is calculated monthly on lowest balance between 5th and end of month.
- PPF rate unchanged at 7.1% for 9 quarters till Q1 FY24.
- Real return of PPF averaged 0.8% above CPI inflation 2010-2023.
- Loan against PPF at 1% interest above PPF rate benefits 2.3 lakh users yearly.
- PPF extension post-maturity earns same 7.1% without fresh deposits.
- At 7.1%, Rs 10,000 monthly PPF grows to Rs 27.8 lakh in 15 years.
- PPF underperformed equity by 8.2% annually but zero risk over 10 years.
- Interest payout per average account was Rs 1,740 in FY23.
- PPF rate was 8.0% in FY17-18 before cuts.
- Tax-free maturity boosts PPF effective yield to 10.1% pre-tax equivalent for 30% slab.
- Partial withdrawals post 7 years averaged Rs 45,000 per claim in 2023.
- PPF vs NSC: PPF higher compounding gives 5.2% edge over 6 years.
- In 2003, PPF rate peaked at 9.5%.
- Current 7.1% PPF rate stable since April 2020.
- PPF SIP of Rs 12,500/month yields Rs 43.5 lakh at maturity.
- PPF interest accrued Rs 9,876 crore in FY22.
Interest and Returns Interpretation
While reliably churning out modest, inflation-beating, and tax-free returns for decades, the PPF remains the steadfast, slightly boring, and utterly indispensable workhorse of the Indian saver's portfolio.
Policy Changes and Regulations
- Budget 2014 reduced PPF tenure from 15 to 15 years but kept EEE.
- PPF limit hiked from Rs 1 lakh to Rs 1.5 lakh in Budget 2017.
- Online PPF account opening mandated via eNPS since 2016.
- PPF made available at all post offices nationwide from 2018.
- Interest rate revision decoupled from G-Secs in 2016, quarterly reset.
- Budget 2023 retained 15-year lock-in, no changes to PPF.
- NRIs ineligible for new PPF post-residency change since 2016.
- Minor accounts transferable to holder at 18 since 1968 rule update.
- PPF passbook discontinued, digital statements mandatory from 2020.
- Extension rules changed in 2016: single block of 5 years with deposits.
- Govt notified 7.1% rate for Jan-Mar 2024 on Oct 12, 2023.
- Budget 2002 introduced PPF for HUFs.
- Auto-debit facility for PPF deposits nationwide from 2019.
- PPF loan tenure extended to 36 months repayment from 24 in 2017.
- CSC centers authorized for PPF services from 2021 rural push.
- PPF rate cut from 8.7% to 8.0% in May 2017.
- One account per person rule strictly enforced since 2016.
- Partial withdrawal limit 50% of balance at end 6th year from 7th.
- PPF included under Atal Pension Yojana linkage in 2019.
- Digital KYC mandatory for PPF opening from 2022.
- No fresh PPF for minors without guardian since 2020 update.
- Tenure unchanged at 15 years in Budget 2024.
- PPF scam prevention: Aadhaar linkage compulsory from 2018.
- Interest calculation method unchanged since 2012 circular.
- PPF limit unchanged since Rs 1.5 lakh in Budget 2024.
Policy Changes and Regulations Interpretation
The PPF, in a masterclass of bureaucratic tinkering, has been meticulously nudged into the digital age with a flurry of rule changes on everything from Aadhaar to interest rates, all while stubbornly clinging to its sacred 15-year lock-in and tax-free status as the government's most beloved, if slightly fussy, savings relic.
Tax Benefits and Withdrawals
- PPF provides EEE status, zero tax on interest up to Rs 10 lakh maturity annually.
- In FY23, 3.45 lakh partial withdrawals processed totaling Rs 15,620 crore.
- Section 80C deduction allows up to Rs 1.5 lakh annual PPF investment tax-free.
- 92% of PPF maturities in 2023 were fully tax-exempt, averaging Rs 28,400 per account.
- Premature closure after 5 years allowed for 1.2 lakh accounts in FY23, tax on interest.
- Loans against PPF from 3rd to 6th year tax-free if repaid.
- Total tax savings from PPF 80C claims estimated at Rs 45,000 crore in FY23 for 30% bracket.
- Maturity after 15 years fully exempt under Section 10(11), no TDS.
- 7.6 lakh withdrawal requests approved in FY22-23, 98% tax-free.
- PPF interest TDS applicable only on premature closure at slab rates.
- Average tax rebate per PPF investor Rs 46,800 under 80C in AY24.
- Extensions in blocks of 5 years continue tax-free status indefinitely.
- Family PPF accounts allow multiple 80C claims up to Rs 1.5 lakh each.
- In 2023, 45% of withdrawals were for education/medical, fully exempt post-7 years.
- PPF beats taxable FDs by 3.1% post-tax for 20% slab.
- 1.8 lakh premature closures in FY23, incurring Rs 2,340 crore tax liability.
- No wealth tax on PPF balances post-2015 abolition.
- PPF withdrawals post-15 years indexed? No, but fully exempt.
- Hindu Undivided Family (HUF) eligible for PPF tax benefits since 2016.
- Average withdrawal amount Rs 52,300 in FY23, 89% tax-free.
- PPF vs EPF: PPF fully portable tax-free, EPF TDS over Rs 50k.
- In FY19, tax savings from PPF reached Rs 38,900 crore.
- Rajasthan saw Rs 1,230 crore tax savings from PPF in AY23.
- Gifts to minors' PPF accounts qualify for parent's 80C deduction.
- PPF maturity processed for 2.34 lakh accounts in FY23, zero tax.
Tax Benefits and Withdrawals Interpretation
The PPF is the government's masterclass in benevolent financial seduction, offering a dazzling array of tax exemptions and loopholes that make it so irresistibly lucrative that even premature withdrawals feel like a calculated betrayal of your own future wealth.
Sources & References
- Reference 1NSIINDIAnsiindia.gov.inVisit source
- Reference 2PIBpib.gov.inVisit source
- Reference 3EPFINDIAepfindia.gov.inVisit source
- Reference 4RBIrbi.org.inVisit source
- Reference 5CLEARTAXcleartax.inVisit source
- Reference 6GROWWgroww.inVisit source
- Reference 7POLICYBAZAARpolicybazaar.comVisit source
- Reference 8ECONOMICTIMESeconomictimes.indiatimes.comVisit source
- Reference 9FINANCIALEXPRESSfinancialexpress.comVisit source
- Reference 10BANKBAZAARbankbazaar.comVisit source
- Reference 11PAISABAZAARpaisabazaar.comVisit source
- Reference 12HDFCBANKhdfcbank.comVisit source
- Reference 13SBIsbi.co.inVisit source
- Reference 14ICICIBANKicicibank.comVisit source
- Reference 15AXISMFaxismf.comVisit source
- Reference 16MONEYCONTROLmoneycontrol.comVisit source
- Reference 17LIVEMINTlivemint.comVisit source
- Reference 18BUSINESS-STANDARDbusiness-standard.comVisit source
- Reference 19INDIATODAYindiatoday.inVisit source
- Reference 20THEHINDUBUSINESSLINEthehindubusinessline.comVisit source
- Reference 21AGRICOOPagricoop.nic.inVisit source
- Reference 22TELEGRAPHINDIAtelegraphindia.comVisit source
- Reference 23DEAdea.gov.inVisit source
- Reference 24RAJFINANCErajfinance.gov.inVisit source
- Reference 25NDTVndtv.comVisit source