How to reactivate your lapsed PPF account — A step by step guide

The Public Provident Fund (PPF) stands as an excellent investment choice for numerous individuals in India. It presents appealing features, such as a 15-year investment duration, tax advantages on investments, interest earnings, maturity proceeds, and a decent interest rate of 7.1%. An annual investment in the PPF can range from a minimum of ₹500 to a maximum of ₹1.5 lakh.

Failure to meet the minimum annual contribution of ₹500 may result in the classification of your account as inactive, eventually leading to its closure. If a minimum deposit of ₹500 is not made within a financial year (April 1st to March 31st), your account will be labelled as “inactive”. Inactive accounts do not accrue interest and are not eligible for withdrawals.

Check the status of your PPF account

Reactivating an inactive PPF account is feasible, but specific steps must be adhered to, and potential penalties may be incurred. However, before initiating the revival process for your seemingly lapsed PPF account, ensure that it is genuinely discontinued and not merely inactive. An inactive account, inactive for a year without contributions, can be easily revived. In contrast, a discontinued account, inactive for two consecutive years, necessitates additional steps for reactivation.

Additionally, keep in mind that you cannot restore a permanently closed account. If your account has been closed for over two years without any activity, the funds are refunded without interest, and revival is not an option.

Steps to reactivate your lapsed PPF account

• Go to the branch from where you operate your PPF account, whether it’s a bank or a post office.
• Submit a written request for reactivation, clearly stating your intent to revive the account.
• Deposit the minimum subscription amount required for the ongoing financial year, which currently stands at ₹500.
• Settle a penalty fee of ₹50 for each year the account remained inactive.

Post the reactivation of your PPF account, you are restricted to partial withdrawals or utilizing the loan facility. The reinstated account will resume earning interest from the date of reactivation. To prevent future discontinuation, investors should uphold the minimum annual contribution of ₹500 after reactivating the account.