Over the last few years, there has been some uncertainty for NRIs with existing PPF accounts. In 2017, the government ruled that the PPF accounts would be closed for individuals who became an NRI during the maturity period. Under this law, the close date would be reflective of when the tax residency status changed to NRI.

7.1%
The current interest rate for Q2 (July-September) FY 2021-22 for PPF accounts has been fixed at 7.1%….How PPF Interest Rates have changed over the last 5 years?

As per the ministry circular, PPF will continue to earn 7.10%, the NSC will fetch 6.8%, and Post Office Monthly Income Scheme Account will earn 6.6%. Here is a look at the interest rates on various small savings schemes for the second quarter of FY 2021-22.

Experts say even though the yearly investment amount is limited to only Rs 1.5 lakh, PPF is among the safe fixed-income products. For conservative investors, it is an ideal option due to the fixed rate of return and predictability in the gains in PPF. The PPF account continues to earn tax-free interest after maturity.

NRIs can continue to invest up to ₹1.5 lakh in their existing PPF accounts every financial year. You can also claim deduction under section 80C for PPF deposit if you are filing an income tax return in India. You can invest in your PPF account till maturity, but cannot extend the account once it matures.

Prior to this rule, NRIs (who had a PPF account as a resident Indian) could invest in the fund through an NRO account. They also enjoyed the same rate of interest given to a resident Indian, which was about 7.8% per annum in 2017. The government made amendments to this rule in 2018 and set out revised guidelines for existing PPF account holders.

The Public Provident Fund is a savings-cum-tax-saving instrument in India, introduced by the National Savings Institute of the Ministry of Finance in 1968. The aim of the scheme is to mobilize small savings by offering an investment with reasonable returns combined with income tax benefits. The scheme is fully guaranteed by the Central Government.

The Public Provident Fund (Amendment) Scheme, 2016 made changes in Paragraph 9, for sub-rule 3 (C) of Public Provident Fund Scheme, 1968 to facilitate the premature closure of PPF Account. Premature closure of PPF account is permitted after completion of 5 years for medical treatment of family members and for higher education of PPF account holder.