If you’ve been waiting to see whether the government would increase the PPF interest rate this quarter — here’s your answer. The Finance Ministry has officially released the small savings scheme interest rates for July to September 2025, and while some investors hoped for a hike, there’s no change this time either.
But don’t let that disappoint you — the Public Provident Fund (PPF) still remains one of the most reliable, tax-free investment options for long-term wealth building, especially for retirement.
What’s the PPF Interest Rate This Quarter?
According to the official circular released on June 30, 2025, the PPF interest rate for July–September 2025 remains steady at 7.1% per annum, compounded annually.
Here’s a quick view:
| Period | Interest Rate | Status |
|---|---|---|
| April–June 2025 | 7.1% | No Change |
| July–September 2025 | 7.1% | Still the Same |
Good to Know:
This 7.1% rate has been unchanged since April 2020, despite changes in bond yields or inflation — which shows the government’s commitment to giving consistent returns to small savers.
When Is Interest Credited in PPF?
Interest on PPF is calculated every month but credited annually, at the end of the financial year. However, the monthly balance matters — it’s based on the lowest balance between the 5th and last day of each month.
So if you’re planning to deposit monthly, try to do it before the 5th to get interest for the full month.
Why PPF Still Stands Out (Even Without a Hike)
Let’s walk through why many Indian families continue to trust PPF — even when interest rates don’t rise:
- Tax-free returns under the old tax regime
- Investment, interest, and maturity — all are tax-exempt (EEE benefit)
- Backed by the central government — making it one of the safest options out there
- Long-term discipline — 15-year lock-in helps build large savings gradually
Tip: If you’re planning for retirement or your child’s education, this scheme gives peace of mind with steady compounding over the years.
How Much Can You Invest in a PPF Account?
- Minimum investment: ₹500 per year
- Maximum limit: ₹1.5 lakh per year
- Where to open:
- Post offices
- Public banks (like SBI, Bank of Baroda)
- Select private banks (like HDFC, ICICI)
You can deposit in lumpsum or installments — up to 12 times in a year.
Tax Benefits Under Old Regime (Section 80C)
If you’re still filing taxes under the old regime, PPF offers one of the best tax benefits:
- You can claim up to ₹1.5 lakh per year under Section 80C
- The interest earned and maturity amount are fully exempt under Section 10
Note: These benefits are not available under the new tax regime. So if you’ve shifted, you won’t get 80C deduction — but the interest still stays tax-free.
What Happens After 15 Years?
The PPF account matures after 15 years, but you don’t have to withdraw it right away.
You have two choices:
- Withdraw and close the account
- Extend it in 5-year blocks (with or without fresh contributions)
That means if you want to continue earning tax-free interest beyond 15 years, you can — making it even more useful as a retirement planning tool.
FAQs: PPF Interest Rate July–September 2025
Q1. Has the PPF interest rate increased for Q2 2025?
No, it remains unchanged at 7.1%, same as the last quarter.
Q2. Is the interest earned on PPF taxable?
No. The investment, the interest, and the final maturity amount are all tax-free.
Q3. Can I still get 80C benefits under the new tax regime?
No. Section 80C benefits are only available under the old tax regime.
Q4. How often is PPF interest updated?
The government reviews and updates small savings scheme interest rates every quarter.
Q5. What if I deposit after the 5th of the month?
Interest for that month won’t be calculated on the new deposit — deposit before the 5th to earn full interest
Before You Go…
The Public Provident Fund might not offer the highest returns in the market, but its predictability, tax-free benefits, and long-term compounding make it a powerful tool for secure wealth creation.
If you’re looking for stability over speculation, this quarter’s unchanged rate might just be the opportunity you need to continue — or start — your PPF journey.
Official Source: https://nsiindia.gov.in
