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Key Highlights of IDBI Bank PPF Account

CategoryDetails

Rate of Interest 

7.1% annually

Eligibility

Can be opened at any age by any resident Indian (HUFs and NRIs not allowed)

Tenure

15 years

Nomination 

Facility available for maximum 4 nominations 

Tax Benefit 

Tax deduction u/s 80C up to Rs. 1,50,000

Minimum Deposit amount 

Rs. 500

Maximum deposit amount

Rs. 1,50,000

Eligibility to open account under PPF account

The eligibility under PPF accounts is open to all the residents of the country irrespective of their age or their any other criteria.

The details of the eligibility under PPF accounts are mentioned hereunder.

  • PAN card is a mandatory requirement for opening a PPF account.
  • Eligible individuals can invest on behalf of minors or persons of unsound mind.
  • Such investment can be done by the parents or grandparents (or guardians in their absence).
  • Parents can invest in only one PPF account for one minor child.
  • Investment in the name of a minor will be clubbed with the investment of such parents in order to determine the maximum limit of investment by the parent.
  • Joint holding of PPF accounts is not permitted under the scheme.
  • HUFs and NRIs are not allowed to open a PPF account.

Documents required for IDBI Bank PPF Account

The list of documents required to open a PPF account with IDBI Bank are,

  • Application Form A for account opening which has to be duly filled/ signed printout of Form A which is filled online.
  • Self attested copies of address proof of the individual as per Know Your Customer (KYC) norms (Passport, Aadhaar Card, Electricity Bill etc.)
  • Self attested copies of identity proof – Aadhaar Card, PAN Card, Driving License, Voter ID, etc.
  • Nomination Form E
  • Recent Passport Size Photographs.

Features and Benefits of IDBI Bank PPF account

Investment in PPF is mainly beneficial to those who do not have an EPF account (either mandatory or voluntary) as it enables them to have many of the similar features and benefits of a provident fund. The details of the features and benefits of opening a PPF account with IDBI Bank are provided here.

  • An investor can open a PPF account for the initial tenure of 15 years. An extension of such an account is allowed based on his/her discretion for one or more blocks of 5 years each.
  • The minimum contribution to be made each year is Rs. 500 and the maximum contribution that can be made each year is Rs. 1,50,000.
  • Contribution made beyond Rs. 1,50,000 in a particular year is not eligible for any interest or tax benefits.
  • The current rate of interest offered on IDBI Bank PPF accounts is 7.1% per annum with effect from 1st April 2021.
  • Interest on PPF account is calculated on the minimum balance available in the investor’s PPF account between the 5th and the last day of the month.
  • The interest is paid on the 31st March of every year that the investment is held.
  • Interest on PPF is eligible for tax exemption and the investment in PPF is eligible for Tax deduction under section 80C of the Income Tax Act, 1961 up to Rs. 1,50,000.
  • The scheme also provides for nomination under the PPF scheme by submitting a Form E in this regard.
  • An investor can nominate one or more persons (maximum 4) under the PPF scheme offered by the bank.
  • The investor can define the shares of each of such nominees as well as change the nomination or percentage of share via Form F.
  • The investor can also avail loans and withdrawals against his/her PPF account. 
  • The limit or extent of such loans and withdrawals is calculated based on the age of the account i.e. the duration for which it is held and the amount available in the account.
  • Investor can also transfer his/her PPF account form one branch to any of the other branches of the bank or any other bank or post offices across the country and vice-versa.
  • The investor has to submit a written request for the same.
  • The investor is also allowed to hold the PPF account post its maturity without any contribution.
  • Such accounts will not be treated as a dormant account and will also earn interest at the prevailing rates.

Depositing amount in PPF

An investor has to deposit money or make a contribution to the PPF account every year during the tenure of the account. If the investor fails to invest in the account even for 1 year, such an account becomes dormant or inactive. The depositor can make the deposit to his/her PPF account during any year based on the following limits according to the PPF scheme,

  • Minimum Rs 500 
  • Maximum Rs. 1,50,000

An investor can invest in PPF account through any of the following ways

  • Direct debit from the existing IDBI Bank savings or current bank account of the investor.
  • Online transfer from another bank account of investor via NEFT/ ECS
  • Payment in cash or cheque or demand draft.

The depositor contributions to the PPF account can be made either in a lump sum payment or in installments. However, such installments are subject to certain restrictions which are stated below.

Such installments cannot exceed,

  • More than 2 in any particular month
  • More than 12 in a particular year

What happens when a PPF account gets dormant or inactive?

If the investor fails to make a continuous deposit or contribution to his/her PPF account such an account is converted to a dormant account.

Dormant accounts have limited benefits as compared to the normal PPF accounts. Such limited benefits include restriction on loan facilities and withdrawals. The scheme, however, still provides such accounts to earn interest at the same rate as any other PPF account.

Dormant accounts can be revived to its fully functional state by following the steps below,

  • Submitting a written request at the issuing post office or branch of the bank.
  • Payment of minimum yearly deposit amount of Rs.500 for each year that the account has remained inactive vide Form B.
  • Form B to include payment of a fine of Rs.50 for each year the account had been inactive along with minimum contribution.
  • Visiting the branch/post office of PPF account to complete the verification process.

IDBI Bank PPF calculator

The bank enables the investor to estimate the value of his/her investment at the time of maturity with its PPF calculator. This enables the investor to plan for his/her future expenses or know the correct amount of investment to be made in order to build the required fund. The investor has to input the following values or details in the PPF calculator available at the bank’s website in order to get the details of the maturity value.

  • Principal amount invested.
  • Rate of Interest.
  • Tenure of PPF deposit.

Loans against IDBI Bank PPF account

An investor can avail loans against their PPF account with the bank. Such loans are dependent on the balance held in the PPF account as well as the period for which the account is held with the bank. Some of the main points of contention regarding such loans are,

  • A written request has to be submitted for applying a loan from the bank along with a duly filled Form D.
  • An investor can 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.
  • Also, 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 current interest rate on loan 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.

IDBI Bank PPF account customer care

According to the scheme, the customer can seek any assistance required regarding his/her PPF account (like manner of contribution, viewing of PPF account, status of contribution made, etc.) from the bank or post office which has the PPF account of the investor. Therefore, the customers having their PPF account with the bank can contact the bank via the following channels and get answers to their queries or any information that they may require regarding their PPF accounts.

IDBI Bank Ltd.
    IDBI Tower, WTC Complex,
    Cuffe Parade,

    Colaba, 

    Mumbai 400005

About IDBI PPF account

Industrial Development Bank of India or more commonly known as IDBI Bank has its origin in the year 1964. It had initially operated as a subsidiary to RBI but was eventually transferred to the Government of India. Furthermore, the RBI via a clarification has specified that the bank will be considered to be a private sector bank for regulatory purposes post the revised investment by LIC with the bank.

IDBI Bank is among the many banks authorized by the government to enable the opening of a PPF account. The government has authorized the bank to help the eligible applicants in opening a PPF account in its 675 authorized branches. PPF was initiated by the Government of India in the year 1968 and is governed by the National Savings Institute of the Ministry of Finance.

FAQs: IDBI PPF Account

1. What is the current rate of interest rate on loans against PPF accounts/

The rate of interest applicable on loans against PPF accounts is 1% per annum.

2. Where can a person open the PPF account with the bank?

The investor can open a PPF account with the bank in any of the authorized 675 branches. The detailed list of these branches is available at the bank’s website.

3. How can a person change the nomination of his/her PPF account?

The investor can change the nomination or the share of the nominees (in case of more than one nominee) via Form F.

4. What is the Form number for applying an extension of the PPF account?

The investor can apply for extension of the PPF account via Form H.

5. What is the form number for partial withdrawal from the PPF account?

An investor can withdraw from the PPF account by submitting Form C in this regard and subject to the prevailing conditions in this regard.

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