PPF Interest Rate for January–March 2026 Remains at 7.1%

The Finance Ministry has announced the Public Provident Fund (PPF) interest rate for the January–March quarter of FY 2025–26, keeping it unchanged at 7.1%. The announcement was made on December 31, 2025, along with interest rates for other small savings schemes.

With no revision in the rate, PPF investors will continue to earn 7.1% tax-free interest on their deposits during the first quarter of calendar year 2026. No Change in PPF Rate for the Last Quarter of FY 2025–26

This is not the first time the rate has been retained. The PPF interest rate for the October–December quarter of FY 2025–26, announced on September 30, 2025, was also kept unchanged at 7.1%.

In fact, the PPF interest rate has remained steady at 7.1% since April 1, 2020. Before this period, PPF offered:

• 7.9% interest from July 1, 2019, to March 31, 2020
• 8% interest from October 1, 2018, to June 30, 2019

Who Is Eligible to Open a PPF Account?

The following individuals are eligible to open a PPF account:

• A resident Indian adult in their own name
• A guardian on behalf of a minor or a person of unsound mind

However, an individual can hold only one PPF account across the country, whether opened at a Post Office or a Bank.

Key Features and Benefits of a PPF Account:

A PPF account offers several long-term financial and tax benefits:

• You can invest up to ₹1.5 lakh per financial year
• Contributions qualify for tax deduction under Section 80C, applicable only under the old tax regime
• Interest earned and maturity proceeds are fully tax-free under both old and new tax regimes
• The maturity period is 15 years

Amid declining fixed deposit rates, PPF continues to be a safe, government-backed, and tax-efficient long-term investment option for conservative investors.

How Is the PPF Interest Rate Decided?

The government follows the recommendations of the Shyamala Gopinath Committee while deciding interest rates for small savings schemes like PPF.

According to the committee’s formula, the PPF rate should be linked to the average secondary market yield on 10-year government securities (G-Secs) from the previous quarter, plus a spread of 25 basis points. However, the government does not always strictly adhere to this formula.

For example, during the July–September quarter, the average yield on 10-year G-Secs ranged between 6.32% and 6.54%. Based on the committee’s recommendation, the PPF rate should have been in the range of 6.57% to 6.79%, which is lower than the current rate of 7.1%.

Despite this, the government chose to retain the existing PPF interest rate, ensuring stability and continued attractiveness for long-term investors.