The Public Provident Fund (PPF) is a popular and safe avenue for securing one’s future. Most people invest in it for the long term, and it has a maturity period of 15 years. There is a common perception that funds cannot be withdrawn from a PPF account before the completion of these 15 years; however, this is not entirely true. If you require funds during an emergency, the government allows for withdrawals even before maturity. Here is how and when you can withdraw this money.
When can withdrawals begin?
The process of making partial withdrawals from a PPF account begins from the 7th financial year. The condition for this is that five financial years must have elapsed since the year the account was opened. For instance, if you opened a PPF account in the 2020-21 financial year, you would be eligible to withdraw funds from the account starting from the 2026-27 financial year.
How much money can be withdrawn from the account?
A specific limit has been set for withdrawals, which depends on two balance figures: the balance in your account at the end of the previous financial year, and the account balance as it stood four years prior to the year of withdrawal. You may withdraw 50 percent of whichever of these two amounts is lower. Suppose your PPF balance was ₹8 lakh at the end of the last financial year, and four years ago, it was ₹6 lakh. In this case, the lower amount of ₹6 lakh will be considered as the basis, and you can withdraw a maximum of ₹3 lakh. Remember, a withdrawal can be made only once in a financial year.
What are the options after 15 years?
The maturity period of a PPF account is 15 years, calculated from the end of the financial year in which the account was opened. Upon completion of the 15-year term, you can withdraw the entire amount along with the accrued interest. If you do not wish to withdraw the money, you can continue the account. There are two ways to do this: you can keep the account active without making any new deposits, in which case you will continue to earn regular interest. If one wishes to continue investing, the PPF account can be extended in blocks of five years. Generally, the entire amount cannot be withdrawn before maturity; however, under certain special circumstances—such as financial hardship, treatment for a serious illness, urgent requirements for higher education, or if the depositor becomes a Non-Resident Indian (NRI)—the account can be closed after the completion of five years. In such cases, a 1% deduction is made from the accrued interest. In the unfortunate event of the account holder’s death, the entire amount is paid to the nominee or legal heir without waiting for maturity. Since PPF is a long-term investment, it should not be used for day-to-day expenses; however, the facility to withdraw funds during emergencies proves to be very helpful for customers.
