RECENT GUIDE FOR CHANGES EFFECTIVE IN OCTOBER 2024
In the past year, Public Provident Fund (PPF) has played a vital role in safe investments offering tax benefits and competitive interest rates.
It’s a full fledge guide on personal finance, wealth accumulation and how to encourage savings.
In this “Blog,” we will understand the changes in detail and how they will affect individuals’ approaches to their investment schemes.
MAJOR CHANGES THAT PPF HOLDER SHOULD BE AWARE OF:-
On August 21, 2024 a circular was announced with the new regulation which will came to effect in October 1, 2024. The report of this shows that all the irregular small saving account should be forwarded under the power of Ministry of Finance.
Also, it comprises on the major three changes:-
CHANGES TO NEW PPF RULES:-
1. PPF ACCOUNT FOR MINOR
Earlier the interest rate applicable on minor account is charged on Standard PPF rates, but after the new guidelines it states that the PPF account for minor will earn interest at the rate of Post Office savings Account (POSA) until the minors turns into 18.
The new guidelines also states that once the minor attains the age of 18, the interest rate applied on their PPF is going to be Standard Rates again
The maturity period for these accounts are calculated starting from the date the minor attends the adulthood.
2. FOR MORE THAN ONE PPF ACCOUNT
This rule mandates that anyone with one or more PPF accounts earns the rate of interest only on the primary account.
The investor can choose two accounts from any post office or agency bank and after the authorization they can choose the primary one to maintain in the future
It also specify that if the primary account stays below the limit of investment in every year than the balance of second amount will combine to it. Also, after the merger if there is any excess balance then it will returned without interest.
It also mandates that apart from primary account any other secondary account will not earn any interest from the date of opening.
3. NRI’s EXTENSION OF PPF ACCOUNT
If we talk about NRI’s PPF Account in earlier time they get interest according to the Post Office Savings Account (POSA) but after the new regulation has passed it states that if NRI’s having PPF account than they will not earn any interest if they want to continue their PPF Account they can but they will not get any interest. Also, they earn interest until September 30, 2024 afterwards there is no such rules for gaining any kind of interest.
CONCLUSION
These three major changes are taken place for stopping the irregulation of account so that, Ministry of finance can take charge on it.
