Public provident fund: the unknown known

Abstract

It may perhaps be the best time for the government to introduce reforms in the coming Budget to radicalise government-saving schemes. This is a story of Young India, which is both India and Bharat (not necessarily in the order of importance, though). Expectedly, young Indians are smart, technology savvy but unexpectedly are risk-averse investors. Our Bharat/rural India in 2015 is now investing more (vis-a-vis 2014) and yearning to invest even more. These are some of the remarkable findings of our large random sample study of Public Provident Fund (PPF) accounts opened by the State Bank of India for the two-year period ended 2015. PPF is a government-backed, zero-default risk, long-term small savings scheme initially started to provide retirement security to self-employed individuals and workers in the unorganised sectors. Currently, with a maximum allowable corpus of Rs 1.5 lakh, it is perhaps considered the best tax-saving scheme by all sections of people planning to invest and save. The interest rate earned out of PPF is tax-free and subsumed under the overall consolidated amount of Rs 1.5 lakh in Section 80C. Read more at: https://www.business-standard.com/article/opinion/soumya-kanti-ghosh-pulak-ghosh-public-provident-fund-the-unknown-known-115122800979_1.html