According to Forbes, the State Bank of India is 29th most trustworthy company in the world. State Bank of India (SBI) is one of the largest banks in India. SBI provides PPF account from which you can handle investments in PPF. Public Provident fund (PPF) is a plan which is launched by the Government of India in 1968. PPF account can be opened in the Post office or branches of Public Sector Banks all over the country. In this plan, any civilian of India can claim an income tax refund with interest on the investments under suitable Income tax laws. Minor can also make contribution to the plan. The period of the scheme is of 15 years but can be extended for 1 to 5 years.

Eligibility: Individuals or Individuals on behalf of a minor

Minimum Investment (w.e.f. 15-11-2002): Rs.500/- per annum in multiples of Rs.5/-

Maximum Investment (w.e.f. 15-11-2002): Rs.70, 000/- per annum

Tax Benefits:

• Amount standing to the credit is fully exempted from Wealth Tax.
• Benefit available u/s 88 of the I.T. Act.
• Interest totally exempt from Income Tax.

Facilities given by SBI PPF Account:

1. Nomination available in the name of one or more persons.
2. Premature closure of a PPF account on grounds of genuine hardship could be considered only after the expiry of five years from the end of the year in which the account was opened.
3. Subscription in one or more maximum 12 installments.
4. An account may be transferred at the request of the subscriber free of charge by one branch of State Bank of India or its Associates to Head Post Office or vice versa.
5. Nominee can not continue account of the deceased subscriber in his/ her own name.
6. Discontinued account can be revived on payment of Rs.50/- per year along with arrears of subscription of Rs.500/-
7. The subscriber may discontinue his account anytime after joining the fund. The repayment of the subscription with interest will be made only after 15 years from the end of the financial year in which the account was opened.

Rate of Interest: The rate of interest of the PPF account is calculated on every 31st of March at 8%. This rate of interest is calculated on the base of minimum amount which is in your account between 5th of March and 31st of March.

Loans: You can take loans of up to 25% of the balance at the end of 1st financial year from 3rd to 6th year. Next loan can be taken on full payment of first loan.

Withdrawal policy: The amount of withdrawal is not possible for the first five years. After 5th year you can withdrawn the account but that can be made only once in a financial year. You can withdraw 60% of amount, if your account is extended away from 15 years.

Benefits:

1. Tax Savings under the Section 80C of the Income Tax Act
2. Minimum amount required for opening is Rs.500/-
3. Interest rate 8% compounded annually
4. Safety of investment to the individual
5. PPF Account can be retained after the maturity for any period without making any further deposits just to earn interest at normal rate as admissible
6. Interest on deposits is tax free
7. Deposits made in the PPF accounts are also exempt from wealth tax
8. Account can be transferred from one post office or bank to another post office or bank
9. Tax Benefit can be claimed for making the contribution to the PPF account of spouse or minor children

Source: http://www.statebankofindia.com/user.htm

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