While banks and NBFCs have authority over fixed deposits, PPF is a savings scheme provided by the Government of India. You can start a deposit in FD with a minimum of Rs.100 to Rs.1000. However, the minimum deposit in PPF starts from Rs.500. In order to withdraw PPF, one has to follow the rules and regulations of the government. However, FD withdrawal is much easier as compared to PPF. Individuals, HUFs, Corporations, Trusts, Institutions and NRIs can make FD deposits. But, only Indian citizens can join PPF.
Duration..
Time to make fixed deposits starts from 7 days. Fixed deposits can be made for a period of 10 years. Some banks also offer FDs with a tenure of 20 years. On the other hand.. PPF tenure is 15 years. After maturity time can be extended once every 5 years. While it is allowed to open a joint account in FD, it is not allowed in PPF.
interest rate
Various banks and non-banking institutions are offering interest ranging from 2.90 to 7 percent on fixed deposits. It varies by tenure. On the other hand, the government is currently paying 7.10 percent interest on PPF. Loans can be taken on FDs at any time. In PPF, deposits are allowed only after 3 years of commencement. While early withdrawal is possible depending on the type of FD.. Withdrawal can be done only after 5 years of account opening in PPF.
Tax..
The government levies tax on fixed deposits depending on the annual income. However, there is no tax on the deposits made in the PPF scheme. Tax saving on FDs Only FDs offer tax benefits under 80C up to Rs 1.50 lakh. Exemption is applicable under Section 80C for annual deposit up to Rs.150 lakh in PPF.
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