PPF Partial Withdrawal and Premature Closure Rules in India

Your Public Provident Fund money is not locked solid for 15 years: you can take a partial withdrawal from the start of the 7th financial year, and you can close the account early after 5 years on specific grounds with a small interest penalty. Both routes are governed by the Public Provident Fund Scheme, 2019, notified on 12 December 2019 under the Government Savings Promotion Act, 1873.

A partial withdrawal lets you take out a slice of your PPF balance while the account stays open and keeps earning interest. Premature closure ends the account entirely before its 15-year maturity, but only on limited grounds and with an interest penalty. Both differ from normal closure at maturity.

• Governing law. The scheme is the Public Provident Fund Scheme, 2019, notified 12 December 2019 under the Government Savings Promotion Act, 1873, replacing the old PPF Scheme, 1968. See the Income Tax Department text of the Scheme.
• “Year” means financial year. Paragraph 2 defines “year” as the financial year (1 April to 31 March), so every eligibility window is counted in financial years, not from the calendar date you deposited.
• Partial withdrawal, Paragraph 10. “Any time after the expiry of five years from the end of the year in which the account was opened” the holder may, in Form-2, withdraw “an amount not exceeding fifty per cent of the amount that stood to his credit at the end of the fourth year immediately preceding the year of withdrawal or at the end of the preceding year, whichever is lower.” The facility “may be availed only once in a year.” See the full Scheme text on Indian Kanoon.
• Premature closure, Paragraph 13. An account “shall not be closed before the expiry of five years” and then only on three grounds: (a) treatment of a life-threatening disease of the account holder, spouse, dependent children or parents; (b) higher education of the holder or dependent children; © change in residency status of the holder. On premature closure, “interest in the account shall be allowed at a rate which shall be lower by one per cent than the rate at which interest has been credited.” The application is in Form-5.
• Maturity and extension. Paragraph 11 sets maturity at “fifteen years from the end of the year in which the account was opened.” Paragraph 12 allows extension “for a further block period of five years,” repeatable. Closure at maturity uses Form-3.
• Current interest rate. For the first quarter of FY 2026-27 (1 April to 30 June 2026) the PPF rate is 7.1 percent, unchanged in the Ministry of Finance notification “Revision of Interest rates for Small Savings Schemes” dated 30 March 2026 on the Department of Economic Affairs Small Savings page. The rate is revised quarterly, so check the NSI current-rate page before relying on it.

1. Confirm eligibility: the financial year of withdrawal must be after five full years from the end of the year of account opening. An account opened in 2019-20 becomes eligible from 2025-26 (the 7th financial year).
2. Work out your cap: take 50 percent of the balance at the end of the fourth preceding year, and 50 percent of the balance at the end of the preceding year, then use whichever figure is lower.
3. Check you have not already withdrawn this financial year: only one partial withdrawal is allowed per year.
4. Fill Form-2 at your bank or post office branch, or through net banking if your provider supports it.
5. Submit the passbook and Form-2; the amount is credited to your linked savings account. The PPF account stays open and the remaining balance keeps earning interest.

1. Confirm the account has completed five full financial years from the end of the year of opening; before that, no premature closure is allowed.
2. Confirm your ground falls under Paragraph 13: life-threatening disease (holder, spouse, dependent children or parents), higher education (holder or dependent children), or change in residency status.
3. Gather supporting proof: medical documents from a competent authority for illness; fee bills or admission proof for higher education; passport and visa for change in residency status.
4. Fill Form-5 at the branch and attach the proof.
5. Accept the penalty: interest is recalculated at 1 percent below the rate credited since the account opened (or since extension). The reduced balance is then paid out and the account is closed.

• Counting from the deposit date, not the financial year. Eligibility runs from the end of the year of opening, so an early-April opening and a late-March opening in the same FY are treated identically.
• Assuming you can withdraw 50 percent of today's balance. The cap uses the lower of the fourth-preceding-year and preceding-year balances, which is usually far less than the current balance.
• Trying to withdraw twice in one year. Paragraph 10 allows only one partial withdrawal per financial year.
• Expecting penalty-free early closure. Premature closure always costs 1 percent of interest for the whole life of the account, and is barred entirely before five years.
• Confusing premature closure with maturity. At 15 years you use Form-3 with no penalty; premature closure is a different route under Form-5.

If a bank or post office refuses a valid Form-2 withdrawal or Form-5 closure, sits on it, or cannot explain the delay, file an RTI to the public authority. Ask for the file notings on your application, the date it was received, the officer handling it, and the reason for any delay. Draft it free with the AI RTI Drafter. If the reply is missing or evasive within 30 days, escalate with the First Appeal Builder.

Any time after five full years from the end of the year you opened the account, which is the 7th financial year. An account opened in 2019-20 is eligible from 2025-26.

Up to 50 percent of the balance at the end of the fourth preceding year or the preceding year, whichever is lower, and only once in a financial year, using Form-2.

Only three: treatment of a life-threatening disease of the holder, spouse, dependent children or parents; higher education of the holder or dependent children; or a change in the holder's residency status. Premature closure needs five completed financial years and Form-5.

Interest is recalculated at 1 percent below the rate that was credited, applied for the entire period since the account was opened. That reduced amount is then paid out.

For the April-June 2026 quarter the rate is 7.1 percent per year, unchanged in the 30 March 2026 Ministry of Finance notification. It is revised quarterly, so verify the current figure on the NSI website.

No. A partial withdrawal keeps the account open and the remaining balance keeps earning interest. Only premature closure under Form-5 or maturity closure under Form-3 ends the account.

• Public Provident Fund Scheme, 2019 - Income Tax Department
• Public Provident Fund Scheme, 2019 - full text, Indian Kanoon
• Small Savings interest rate notifications - Department of Economic Affairs
• Current National Savings Schemes interest rates - National Savings Institute
• The full citizen handbook: The RTI Playbook

• AI RTI Drafter
• First Appeal Builder
• PPF account transfer between bank and post office
• NPS partial withdrawal rules in India
• Sukanya Samriddhi account withdrawal rules
• RTI Act, 2005