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Introduction

Canara Bank has a huge variety of products related to savings schemes introduced by the government as well as the bank itself that the customers choose from. This enables the customers to make a sound investment based on the plans that best suit their needs. Public Provident Fund (PPF) was introduced by the Government of India in the year 1968 with the intention to provide retirement benefits to all the citizens of the country as well as a safety net in case of emergencies. PPF is a government backed / assured investment option available in the market as well as a great tax saving tool which is one of the many reasons that the scheme is still a popular choice of investment even after decades of its introduction.

The various details of the PPF account of the bank are mentioned here.

Eligibility Criteria for PPF accounts

The investment in PPF accounts is not age bound i.e., it has no age restrictions or limits for investment. An eligible person can invest in the PPF account anytime during the year and at any age.

The scheme includes minors and persons of unsound mind as potential investors, provided, such eligible persons do not invest in their own name. Either of the parents or guardians in absence of parents or grandparents can invest on their behalf under the scheme.

The scheme although open to all the residents of the country has some specific exclusions from investment under the PPF accounts.

  • NRIs (if a person becomes an NRI after investment in PPF, such person is allowed to hold the investment till maturity or can close the account prematurely by submitting his/her passport and visa  as well as Income Tax returns, but is not allowed the benefit or facility of extension under the scheme).
  • HUFs (the scheme does not permit the HUF to hold or invest in PPF)
  • The scheme also prohibits the investors from having joint accounts.

Documents required for opening a PPF account

The documents required to open a PPF account with the bank are,

  • Completed and signed Form A
  • Duly filled pay-in Slip Form B
  • Nomination Form E duly filled and signed
  • Two recent passport size photographs
  • Identity Proof (Aadhaar Card, PAN Card, Voter’s ID, etc.)
  • Address Proof (Aadhaar Card, Electricity Bill, Water bill, Gas bill, etc.)

Features and benefits of Canara Bank PPF account

The investment in PPF accounts has been a traditionally favored investment over other government schemes due to the various features and benefits that the scheme and the bank offer. Some of such features are detailed hereunder,

  • The current rate of interest on the PPF accounts is at 7.9% per annum and is compounded annually.
  • Investment in PPF accounts has many tax benefits in the hands of the individual. These tax benefits include tax exemption of the entire PPF amount at the time of withdrawal based on maturity.
  • The investor also gets exemption of the interest accrued each year.
  • The contribution to the PPF accounts up to Rs. 1,50,000 is eligible for a deduction under section 80C of the Income Tax Act, 1961 as well.
  • Any contribution beyond the above limit does not attract any tax benefit or interest.
  • The investor can invest in the PPF account each year via a lump sum payment or a maximum of 12 installments during a financial year.
  • Also, investment in any particular month cannot be more than 2.
  • The PPF accounts require a continuous investment for a period of 15 years failing which the account becomes dormant or inoperative.
  • The investor also has the option to further extend the investment for blocks of 5 years each.
  • The bank permits the investor to secure loans against their PPF accounts from the completion of 3rd year but before the completion of 5th year. The amount and the duration of the loan will be dependent on the balance and the number of years that such PPF account is in existence.
  • The maximum amount that can be availed as loan is 25% of the balance in the PPF account at the end of the second year that is immediately before the year in which such loan was applied.
  • The interest charged on loans availed against PPF is 1% per annum.
  • The bank also allows single as well as multiple nominations of the PPF account up to a maximum of 4 nominations under the scheme. Such nomination takes effect in the event of the death of the investor.
  • The investor can stipulate the share of each nominee as well as change it or the number of nominees any time during the tenure of the PPF account.
  • The investor can withdraw from their PPF account before maturity but only after the completion of 5th year from the date of investment.
  • Such withdrawal is permitted only up to the extent of 50% of their balance in the PPF account.
  • PPF accounts can be transferred from one branch of the bank to another or from one bank to another post office or another bank and vice versa.
  • The bank also provides the online facility for PPF accounts in order to be in sync with the ever advancing banking world. The online facility provided by the bank includes viewing the PPF statements or depositing the funds to PPF accounts using the online mode of transfer among many other features. This benefit or feature is available to the existing customers of the bank only, i.e. customers/investors already having a savings or current account with the bank.
  • As per the revised PPF scheme 2019, a person is eligible to hold his/her investment in PPF account beyond the maturity period of 15 years and the account will also attract interest at the prevailing rates till the time it is kept open.

Dormant or Inactive PPF account

In the event that the investor does not make a continuous contribution for a period of 15 years, such account is deemed to be dormant or inoperative.

Such accounts although may earn interest, do not have the same benefits and features as that compared to the normal PPF account. Some of the limited facilities include exclusion from loan availability.

An investor can, however, restore his/her PPF account to its active version or full functions by adhering to the following steps,

  • The investor has to submit a written request at the issuing post office or branch of the bank.
  • The investor will also have to pay the minimum yearly deposit amount of Rs.500 for each year that the account had remained inactive via Form B
  • Form B will also have to include a fine of Rs.50 for each year the account had been inactive.
  • The investor has to further visit the issuing bank’s branch i.e., the branch where the investor has his/her PPF account in order to complete the verification process.

Loans against Canara Bank PPF account

The investor can also avail loans against their PPF account with the bank based on the balance held in the PPF account as well as the period for which the account is held with the bank. The key points to be noted with regards to such loans are,

  • The applicant has to submit a written request for applying for a loan from the bank and duly fill the required Form D.
  • According to the guidelines of the scheme, an investor is eligible to apply for a loan against his/her PPF account only after the completion of 3 years but not more than 6 years of such PPF account.
  • Another stipulation in this regard is with respect to the amount of loan that an investor can avail. The scheme states that the investor can avail loan up to maximum of 25% of the account balance available at the end of the 2nd year.
  • An investor is allowed to avail multiple loans against his/her PPF account subject to the prevailing regulations of the bank.
  • The prevailing interest rate on loans against PPF is 1% per annum for loans taken on and after 12th December, 2019 as against 2% per annum that was previously charged on such loans.

Canara Bank Customer Care Details

Canara bank has a dedicated customer care service that the customers can avail in order to get any information or resolve any query that they may have pertaining to their PPF accounts. The customers can contact the bank through the following channels and get answers to their questions or raise any concerns as well as give their valuable feedback as and when required.

  • Toll free number – 1800 425 0018
  • Email ID - hocss[at]canarabank[dot]com
  • Postal address (Head Office) - Customer Service Section

 Divisional Manager

 Canara Bank,

 SP&D Wing,

 Head Office,

 No.112, JC Road,

 Bangalore -560002

Telephone – 080-22221581/ 582/ 0490/ 0491/ 1788/ 1789/1790/1984/1985/1986

Canara bank also has a digital banking facility for the customers to connect with the bank and carry out their transactions without the need to physically visit the branch of the bank. This digital banking facility of the bank is known as CanDigital.

Another mode of communication available to the customers is the online chat facility that the customers can avail by connecting to the chat portal on the bank’s website.

Apart from the above different ways to connect the bank, it also has a chatbot facility named ‘Canara Saathi’ that assists the customers with any kind of assistance with regards to the products and services of the bank or any other information like locating the nearest branch/ATM, interest rates , etc. Customers need not log in to avail this service. It is available to potential customers as well.

FAQs: Canara Bank PPF Account

1. When is the PPF account of an investor eligible for a loan?

A PPF account is eligible for availing loan only after the completion of 3 years from the date of opening the PPF account but before completion of 6 years.

2. What is the toll free number of Canara Bank that the customers can use to address their queries about PPF?

The toll free number of Canara Bank is 1800 425 0018 that the customers can use to address their queries or get any information regarding PPF accounts.

3. What is the penalty for reviving the dormant PPF accounts?

An investor can revive his/her PPF account by paying a penalty of Rs. 50 for each year that the account was inactive along with the minimum contribution of Rs. 500 as well for all such years in the Form B.

4. Can a person open a PPF account with any of the branches of the bank?

Canara bank is a nationalized bank and hence all the branches of the bank are eligible to open a PPF account.

5. What is the minimum contribution to be made by the investor each year in a PPF account?

The investor is required to make a minimum contribution of Rs. 500 per year in order to keep the account active.

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