1. What is PPF Compound Interest?

The Public Provident Fund (PPF) is a long-term savings scheme with compound interest benefits. The interest is calculated annually but compounded monthly, providing significant growth over time.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

Where:

• \( Principal \) — Initial investment amount (INR)
• \( Rate \) — Annual interest rate (as decimal)
• \( t \) — Time period in years

Explanation: The formula calculates the total amount including compounded interest, then subtracts the principal to show just the interest earned.

3. Importance of PPF Calculation

Details: Understanding potential returns helps in financial planning. PPF offers tax benefits under Section 80C and has a 15-year lock-in period.

4. Using the Calculator

Tips: Enter principal in INR, annual interest rate in percentage, and time period in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How often is PPF interest compounded?
A: PPF interest is compounded annually but calculated monthly.

Q2: What is the current PPF interest rate?
A: As of 2023, the PPF interest rate is 7.1% per annum (subject to quarterly revisions by the government).

Q3: What is the minimum and maximum investment in PPF?
A: Minimum ₹500 per year, maximum ₹1.5 lakh per financial year.

Q4: Can I extend my PPF account beyond 15 years?
A: Yes, in blocks of 5 years after the initial 15-year period.

Q5: Is PPF interest taxable?
A: No, PPF interest is completely tax-free under Section 10 of Income Tax Act.