PPF Interest Rate Oct-Dec 2026: 7.1%, Calculation and Rules
The PPF interest rate is 7.1% a year for the October to December 2026 quarter, compounded annually and fully tax-free. The Finance Ministry left it unchanged at its quarterly review on 30 September 2026, and it has now stayed at 7.1% since 1 April 2020.
The Public Provident Fund (PPF) is a Government of India savings scheme offered at post offices and authorised banks, with a 15-year lock-in and tax-free interest. Here is the current rate, how interest is worked out, and the key rules.
What is the PPF interest rate for October-December 2026?
The PPF interest rate for 1 October to 31 December 2026 is 7.1% per annum, compounded yearly. India Post’s savings schemes page lists the same rate.
The Economic Times reported that the ministry kept every small savings rate as it was for this quarter, and that no scheme’s rate has changed since the December 2024 review. Upstox News carries the same Q3 FY27 table. Unlike a fixed deposit, PPF does not lock in a rate: each quarter’s rate applies to the whole balance. The next review, for January to March 2027, is due by the end of December.
PPF interest rate and rules at a glance
| Feature | Rule |
|---|---|
| Interest rate (1 Oct to 31 Dec 2026) | 7.1% a year, compounded annually |
| Minimum deposit | Rs 500 per financial year |
| Maximum deposit | Rs 1,50,000 per financial year, including accounts you hold as guardian for a minor |
| Tenure | 15 years, extendable in blocks of 5 years |
| Accounts allowed | One per person, at a post office or a bank; no joint accounts |
| Loan | From the 3rd financial year, at 1% above the PPF rate |
| Partial withdrawal | From the 7th financial year, once a year |
| Tax | Deposits deductible (old regime only); interest and maturity tax-free |
Source for limits and timelines: the India Post scheme leaflet.
How is PPF interest calculated?
PPF interest is calculated each month on the lowest balance in your account between the close of the 5th day and the last day of that month. It is added up over the year and credited at the end of the financial year, in March.
As The Economic Times explains, money that reaches the account by the 5th earns interest for that month; money that arrives on the 6th earns nothing until the next month.
A simple example: you have Rs 1,00,000 in the account and add Rs 50,000 on 10 June. June’s interest is worked out on Rs 1,00,000, because that was the lowest balance after the 5th. Had it landed by 5 June, June’s interest would have been on Rs 1,50,000. That is why many investors deposit between 1 and 5 April.
How much will PPF give in 15 years at the current interest rate?
At 7.1%, Rs 1.5 lakh deposited at the start of every year grows to about Rs 40.68 lakh after 15 years. This table is illustrative only and assumes 7.1% holds for all 15 years, which is unlikely.
| Yearly deposit (made by 5 April) | Total deposited in 15 years | Interest earned | Maturity value (illustrative) |
|---|---|---|---|
| Rs 12,000 | Rs 1,80,000 | Rs 1,45,457 | Rs 3,25,457 |
| Rs 50,000 | Rs 7,50,000 | Rs 6,06,070 | Rs 13,56,070 |
| Rs 1,50,000 (maximum) | Rs 22,50,000 | Rs 18,18,209 | Rs 40,68,209 |
Figures are rounded and compound once a year. India Post’s leaflet shows nearly the same result for Rs 1,000 a month: Rs 3,25,456.
PPF interest rate history
PPF has paid 7.1% for more than six years. The figures below are from the National Savings Institute’s rate table (archived June 2026), with the two 2026 quarters since then confirmed by ET.
| Period | PPF rate |
|---|---|
| 1 April 2016 to 30 September 2016 | 8.1% |
| 1 October 2016 to 31 March 2017 | 8.0% |
| 1 April 2017 to 30 June 2017 | 7.9% |
| 1 July 2017 to 31 December 2017 | 7.8% |
| 1 January 2018 to 30 September 2018 | 7.6% |
| 1 October 2018 to 30 June 2019 | 8.0% |
| 1 July 2019 to 31 March 2020 | 7.9% |
| 1 April 2020 to 31 December 2026 | 7.1% |
The highest rate in the scheme’s history was 12%, paid from 1986-87 to January 2000.
Can you take a loan against PPF?
Yes. A loan is available from the 3rd to the 6th financial year, at an interest rate just 1% above the PPF rate, and you must repay it within 36 months.
The PPF Scheme, 2019 cut the loan spread from 2% to 1%. According to ET, if the loan is not repaid within 36 months, the outstanding amount is charged 6% a year instead. You can borrow up to 25% of the balance at the end of the second year before the year you apply, and a second loan is possible only after the first is fully repaid.
When can you withdraw money from PPF?
Partial withdrawals are allowed from the 7th financial year, once a year. You can take up to 50% of the balance at the end of the 4th preceding year or of the immediately preceding year, whichever is lower.
Closing the account early is possible after five full financial years, but only for specific reasons: serious illness in the family, higher education for you or your children, or a change in residency status. It costs 1% less interest for the whole period.
What happens when PPF matures after 15 years?
You have three choices: close the account and take the full tax-free balance, extend it for 5 years with fresh deposits, or let it run for 5 years without deposits. To keep depositing, you must apply on Form 4 within one year of maturity.
If you do nothing, the account carries on without deposits, keeps earning the current rate, and cannot take deposits again later. Extensions can be repeated in 5-year blocks.
Is PPF interest taxable?
No. PPF is an EEE (exempt-exempt-exempt) scheme: the deposit is deductible, the interest is tax-free, and the maturity amount is tax-free.
There is one catch on the deposit side. From 1 April 2026, the old Section 80C deduction sits in Section 123 and Schedule XV of the Income-tax Act, 2025, with the same Rs 1.5 lakh cap, and it is available only under the old tax regime, as Finfod’s guide to the new section numbers explains. Under the default new regime, there is no deduction, but interest and maturity stay tax-free. You need a PAN to open the account; our guide to PAN 2.0 covers what has changed.
PPF vs other small savings schemes
Some small savings schemes pay more this quarter, but their interest is usually taxable, so PPF’s tax-free 7.1% often compares well for people in higher tax slabs. For a monthly payout, the Post Office Monthly Income Scheme at 7.4% suits better, though its interest is taxable. Parents saving for a child’s retirement can also look at NPS Vatsalya, and our roundup of government schemes for families in 2026 lists more options.
Frequently asked questions
What if I miss the Rs 500 minimum?
The account becomes inactive. To revive it, pay Rs 50 for each year missed plus the Rs 500 deposit for each of those years, according to India Post.
Sources: India Post, savings schemes and rates; The Economic Times, rates for October-December 2026; National Savings Institute, PPF rates since inception; India Post scheme leaflet; The Economic Times, PPF Scheme 2019 changes. Rates change quarterly; check with your post office or bank before you invest. This is general information, not personal financial advice.
Featured image: Vis M / Wikimedia Commons, CC BY-SA 4.0 (resized). Kochi Head Post Office, Kerala; illustrative.
