How To Open a PPF Account In SBI Online
If you are searching for a safe long-term investment with high returns, PPF is for you. It is a government-backed savings-cum-investment opportunity. What’s more? It is an EEE option. This stands for Exempt-Exempt-Exempt, implying it is free of tax. The maturity amount, return, and interest are not taxable.
SBI offers the option to open a public provident fund account with them. There is a provision to this both offline and online. The online method allows you to opt for this scheme from the comfort of your home. All you need is an internet connection. Let us see how to get this done.
Prerequisites for PPF Account Opening in SBI
For a seamless online account opening process, you must ensure the following:
- You must have a savings account with SBI. Only such account holders are eligible for the online PPF option.
- You must have enabled the mobile or net banking facilities for the SBI account.
- Your Aadhaar number must be linked with the SBI account.
- You must have an active phone number attached to the Aadhar. This is important for you to receive the OTP while opening the PPF account online.
Once these conditions are met, you can proceed with the process.
Steps to open an SBI PPF account online
We have laid down the exact process for you to easily open a PPF account. Follow the steps given below:
- Log in at the online SBI portal. Follow this link to get to the page.
- After logging in with your credentials, select the option that says “new PPF accounts”.
- When you open this tab, it will display your details. This includes your PAN, name, address, and CIF details.
- When you scroll further, a checkbox will appear asking if you are opening an account for a minor. Tick the box if that is the case.
- Further, you will have to fill out your branch details. Enter the name and code of your home branch to open an account there.
- The next step is to add the details of your nominees. You can enter up to five nominees. You will have to fill in the date of birth of the nominee and the percentage of their share.
- Once you are sure that all information filled in by you is correct, click submit. Just like that, your PPF account will be created. It will also display your PPF account number.
- You will now have to print the account opening form. There will be a tab stating “Print PPF online application”. Once this is done, you must visit the SBI branch within 30 days to finish the procedure. You will have to carry 2 passport size photographs, your KYC documents (identity and address proof), and the printed form.
- You will have to pay an account opening fee of Rs. 100. This is an initial one-time payment. Over and above this, a minimum annual deposit of Rs. 500 must be maintained.
- Once the account is opened, you will also be handed a passbook for your PPF account.
Who can open a PPF account?
To be eligible for opening an SBI PPF account, you must be an Indian resident. Non-residents are not allowed to open a PPF account. You can be a self-employed individual, an employee in the private sector, or a pensioner.
Further, you can only have a single PPF account across the nation. This includes all banks and post offices.
A legal guardian can open a PPF account for a minor. The same goes for a person of unsound mind. In case the guardian dies, the minor cannot take over the account. All the amount is refunded and the public provident fund account is closed.
Key features of an SBI PPF account
Interest rate
The SBI PPF interest rate is fixed by the government every quarter. At present, the latest interest rate is 7.1%. Interest is compounded annually and is tax-free. To get an estimate of your earnings, you can use an online PPF calculator to know how much you should invest.
Deposit amount
Every year, a minimum deposit of Rs. 500 must be made to keep the PPF account active. The upper limit to this deposit amount is Rs.1,50,000.
Maturity period
The lock-in period for a PPF account is 15 years. It is a long-term investment that earns high returns on your savings. You cannot close your account before these 15 years have been completed.
Premature withdrawal
The facility to withdraw money before the completion of the tenure is available. The amount that can be withdrawn is limited to 50% of the balance at the end of the fourth preceding financial year. However, it is only applicable in certain circumstances.
Why should you invest in the PPF scheme?
The public provident fund is a safe investment opportunity. It allows you to save your earnings for retirement, and earn high returns on your deposits. Another plus point is that all returns, as well as the deposited amount, are tax-free. It is an excellent, risk-free addition to your overall investment portfolio.
