Law to raise PPF investment limit set for winter session
The finance ministry will introduce amendments in the Public Provident Fund Act in 1968 in the coming winter session to raise the annual investment limit for an individual to Rs 1 lakh from the present Rs 70,000. HT reports.india Updated: Nov 13, 2011 22:05 IST
The finance ministry will introduce amendments in the Public Provident Fund (PPF) Act in 1968 in the coming winter session to raise the annual investment limit for an individual to Rs 1 lakh from the present Rs 70,000.
"The government will move a bill in the winter session to amend the Act and raise the investment limit to Rs 1 lakh per annum," an official said. The winter session begins on November 23.
This follows the government's announcement on Friday, increasing interest rates on a range of popular post-office saving schemes, a move that will not only make small savings more rewarding for the millions who depend on them but also make more cash available to a government running low on funds this year.
While post office savings accounts (POSA) will fetch 4% interest per annuum, up from 3.5%, the monthly income scheme (MIS) and the public provident fund (PPF) will earn an interest of 8.2% and 8.6% respectively, up from 8% at present, a government release said.
The new rates will be effective December 1.
The annual investment ceiling in PPF savings has been increased to Rs 1 lakh from the present limit of Rs 70,000, borrowing against PPF has been made costlier, doubling its interest rate to 2% per annum.
The PPF scheme is a tax saving instrument administered by the central government framed under the provisions of the Public Provident Fund Act.
The account can be opened in any branch of the State Bank of India or its associates, a post office or in any of the nationalised banks.