Government retains PPF interest rate at 7.1% for October-December 2026 quarter

Key facts

• The government has retained the Public Provident Fund (PPF) interest rate at 7.1 per cent for the October-December 2026 quarter.
• The Department of Economic Affairs notified the small savings rates decision on September 30 as part of its quarterly review.
• The 7.1 per cent PPF rate applies from October 1 to December 31, 2026, with no increase or cut.
• The quarterly decision also covers other small savings schemes such as the National Savings Certificate (NSC), Sukanya Samriddhi Yojana and the senior citizens' savings scheme.
• PPF interest is calculated on the balance according to scheme rules and credited to the account annually, not quarterly.
• An investor can deposit between Rs 500 and Rs 1.5 lakh in a financial year, and the account has an initial maturity of 15 years, extendable in blocks of five years.
• PPF interest is calculated on the monthly balance, so investors benefit from contributing early in the financial year rather than at the end.
• Under the Income Tax Act, 2025, the Rs 1.5 lakh aggregate deduction for specified savings investments is retained under Section 123, relevant to taxpayers opting for the old tax regime.
• PPF interest and maturity proceeds are tax-exempt under the applicable rules.
• A missed minimum annual contribution can make a PPF account inactive, requiring payment of the prescribed fee and penalty for regularisation.