The government has clarified the recent changes to the Public Provident Fund (PPF) account rules, resolving confusion over how they apply to minor accounts. It is now mandatory for a guardian’s name to be linked to PPF accounts opened in the name of minors.
Any PPF accounts opened without listing a guardian will be considered irregular and will only earn interest at the standard savings account rate, which is lower than the usual PPF rate.
New Rules Effective from October 1, 2024
These new rules are set to take effect from October 1, 2024. According to officials, the government is making these changes to regulate accounts that do not follow proper guidelines, especially where a guardian’s name has not been provided for minors. Several individuals have opened PPF accounts under minors’ names without giving their own, leading to non-compliance with the regulations.
Key Points:
- Guardian Name Required: For all PPF accounts opened in a minor’s name, the name of the guardian is mandatory.
- Penalty for Non-compliance: Accounts without a guardian’s name will be marked irregular, and these accounts will earn only savings account interest rates until the minor reaches adulthood.
- Interest Adjustment: Once the minor reaches adulthood, the irregular accounts will start receiving the standard PPF interest rate.
- Clarification Issued: The government issued this clarification to clear up misunderstandings and ensure all PPF accounts adhere to the updated guidelines.
This regulatory update is aimed at bringing more transparency and order to PPF accounts, ensuring compliance with the established rules.
