The Public Provident Fund (PPF) is India's most trusted government-backed savings instrument offering a sovereign-guaranteed return at 7.1% p.a. (FY 2026-27), complete EEE tax exemption, and a 15-year lock-in. Whether you are deciding between PPF and Mutual Fund SIPs, evaluating safe fixed-income assets, or optimizing deposit timing to maximize interest, this calculator and complete guide provide confirmed rates and actionable projections.
PPF Interest Rate FY 2026-27 Current Rate Confirmed
The PPF interest rate for FY 2026-27 is 7.1% per annum, compounded annually and credited on 31st March.
The Government of India reviews the PPF rate quarterly alongside other small savings scheme rates.
The rate has remained unchanged at 7.1% since April 2020—the longest stretch of rate stability in PPF history.
Always verify the current notified rate on the Ministry of Finance website or RBI circulars before making large deposits.
PPF Interest Rate History
PPF interest rate history (recent years): FY 2019-20 Q1: 8.0% → Q2 onwards: 7.9%.
FY 2020-21 to FY 2026-27: 7.1% (unchanged).
The rate peaked at 12% in the early 1990s.
The current 7.1% rate, despite appearing low nominally, offers a high effective return due to full EEE tax exemption—equivalent to a 10.3%+ pre-tax return for taxpayers in the 30% slab.
What Is a PPF Calculator?
A PPF calculator estimates the maturity value of your PPF account at the end of 15 years (or extended tenure) based on your annual contribution and the current 7.1% interest rate.
It provides a year-by-year breakdown of balance, interest earned, and cumulative investment—helping you plan deposits to maximize the tax-free EEE corpus at maturity.
How Is PPF Interest Calculated? (The April 5 Rule)
PPF interest is calculated on the minimum balance between the 5th and last day of each month and credited annually on March 31.
Deposits made before the 5th of the month earn interest for that full month.
Depositing ₹1.5 lakh before April 5 every year instead of making monthly or late contributions earns up to ~₹1.24 lakh to ₹1.40 lakh more over the full 15-year tenure.
Example PPF Calculation at 7.1%
Total invested: ₹22,50,000. Maturity amount: approximately ₹40.68 lakh. Total interest earned: ₹18.18 lakh entirely tax-free. Extended for 5 more years with continued deposits: corpus grows to approximately ₹66.6 lakh. Extended for 10 more years (total 25 years): approximately ₹1.01 crore.
PPF vs SIP: Which Is Better?
PPF provides 100% risk-free capital preservation with sovereign-backed 7.1% tax-free returns under EEE status.
Equity SIPs (Mutual Funds) carry market risk but historically yield 12%–15% CAGR over long horizons.
Investors seeking capital safety choose PPF; those aiming to outpace inflation significantly over 10+ years benefit from SIPs.
Why PPF Is Better Than Bank Fixed Deposits (FDs)
For an investor in the 30% tax bracket, a 7.5% bank FD yields only ~5.16% post-tax because FD interest is added to taxable income.
PPF offers a full 7.1% post-tax yield due to its EEE status, zero TDS, and direct sovereign guarantee—making it significantly superior to FDs for higher-bracket taxpayers.
Why PPF Might Not Be a Good Fit for Everyone
Financial advisors note that PPF may be sub-optimal for young, high-risk growth investors due to its strict 15-year lock-in, ₹1.5 lakh annual contribution cap, and real returns (after accounting for 5–6% inflation) that lag behind market-linked asset classes.
Top 3 Safest & Best Investment Options in India
Top 3 Safest Investments (Zero Market Risk): 1.
Public Provident Fund (7.1% tax-free), 2.
Senior Citizen Savings Scheme / Sukanya Samriddhi Yojana (8.2%), 3.
Post Office Savings Schemes / Sovereign Gold Bonds.
Top 3 Best Investments (Balanced Growth): 1.
Equity Mutual Fund SIPs (for wealth creation), 2.
PPF (for tax-free debt allocation), 3.
National Pension System (NPS).
Frequently Asked Questions
What is the PPF interest rate for FY 2026-27?
The PPF interest rate for FY 2026-27 is 7.1% per annum, compounded annually and credited on 31st March. The rate has been held steady at 7.1% by the Ministry of Finance.
How much will I get after 15 years in PPF?
If you invest the maximum limit of ₹1,50,000 every year before April 5 at 7.1% interest, your maturity amount after 15 years will be approximately ₹40.68 Lakh (₹22.5 Lakh principal + ₹18.18 Lakh tax-free interest).
Is PPF better or SIP?
PPF is better if you prioritize 100% capital safety, guaranteed returns, zero market risk, and tax-free returns. SIP is better if your primary goal is long-term wealth creation, beating inflation, and achieving higher expected returns (12%–15% CAGR).
Why is PPF better than FD?
PPF interest is completely tax-free (EEE status), giving an effective yield of 7.1% post-tax. In contrast, bank FD interest is fully taxable. For a 30% tax bracket investor, a 7.5% FD yields only ~5.16% post-tax.
Which month is better to invest in PPF?
April is the best month to invest. Depositing your annual investment on or before April 5 allows the full amount to earn interest for all 12 months of the financial year.
What is a 5000 per month SIP for 10 years worth?
At an estimated return of 12% p.a., investing ₹5,000/month (total invested ₹6,00,000) over 10 years grows to approximately ₹11.61 Lakh.
Why is PPF not considered a good investment by some experts?
Critics point out PPF's strict 15-year lock-in, modest real returns above inflation (1%–2% net spread), and the ₹1.5 Lakh per year investment ceiling, which limits rapid wealth accumulation.
Which scheme is better than PPF?
For girl children, Sukanya Samriddhi Yojana (SSY) offers higher interest (8.2%) under EEE. For senior citizens, Senior Citizen Savings Scheme (SCSS) offers 8.2%. For long-term capital growth, Equity Mutual Funds outperform PPF.
What are the top 3 safest investments?
1. Public Provident Fund (PPF), 2. Sukanya Samriddhi Yojana (SSY) / Senior Citizen Savings Scheme (SCSS), 3. Post Office Small Savings Schemes & Sovereign Debt.
What are the top 3 best investments?
1. Equity Mutual Funds (via SIPs) for long-term growth, 2. PPF for guaranteed tax-free fixed income, 3. National Pension System (NPS) for retirement planning.
Which SIP is best for 3 years?
For a short 3-year horizon, avoid pure equity SIPs due to market volatility. Choose Arbitrage Funds, Short Duration Debt Funds, or Conservative Hybrid Funds.
Which SIP gives 40% return?
No regulated mutual fund guarantees a 40% annualized return over the long term. While small-cap or sectoral funds may briefly touch 40%+ during bull markets, typical long-term market averages hover between 12% and 18% p.a.