Public Provident Fund Vs Fixed Deposit

Investment in different avenues generally depends upon the objectives of the investors such as amount of investment, tenure, returns, taxability, risk bearing capacity etc. Though there are many choices of investment available in the market, Bank FD and PPF are ideal for those who have a lower risk appetite.

As a long-term saving instrument PPF, backed by the Government of India, provides not only guaranteed returns but also generates tax-free maturity, is the best suited for those investors who require the old-age income security. It is the ideal option to the people whom safety of capital is of utmost importance.

If a person who is risk averse but does not want a lock in of his funds and also wants better returns then FD is the best alternative in which the investor needs to make a lump sum investment for a fixed tenure and on this invested amount, banks offer you to get a fixed interest periodically till the end of the term or you may directly get whole interest along with the principal at the time of maturity. FDs of nationalized banks are considered as highly secured instruments.

Still there may be many questions in your mind as to where to invest between FD and PPF, we have tried to compare both these instruments in order to answer maximum questions in the table given below:

Difference Between Public Provident Fund and Fixed Deposit

Basis of DifferencePublic Provident Fund (PPF) Bank Fixed Deposit (FD)
Maximum Investment Amount
Rs 150,000 per year
Vs
No such limit
Interest RatesFixed- presently 8.1% p.a.
Vs
Variable- from 7 to 9% based on term
Interest Rates
Compounding
Annually
Vs
Quarterly
Interest earned is
taxable
No
Vs
Yes
LiquidityNo
Vs
Yes
Lock in Period 15 Years
Vs
7 days to 10 years
Income Tax Rebate u/s 80CYes, upto Rs 1,50,000/- p.a.
Vs
Yes upto Rs 1,50,000/- p.a., but on FD
with a lock in period of 5 or more years
MaturityTax Free
Vs
Taxable
Premature WithdrawalsOnly partial amount, after the 5th year
and subject to a limited extent only
Vs
Entire amount, anytime but after
charging a certain penalty
Loans/Overdraft Loan from third year onwards
Vs
overdraft facility upto 90% of the
amount in the FD
Tax Deduction at SourceNil
Vs
Yes at the rate of 10% on interest
earned if if it exceeds Rs. 10,000 in
one financial year
RiskSafest Investment
Vs
Risky as compared to PPF
Periodic IncomeNo
Vs
Yes

Upcoming Bank Holidays

2019 April 27 is a bank holiday in Andaman And Nicobar Island due to 4th Saturday Bank Holiday.
2019 May 01 is a bank holiday in Andhra Pradesh due to May Day / Labour Day.
2019 May 01 is a bank holiday in Maharashtra due to Maharashtra Din.
2019 May 07 is a bank holiday in West Bengal due to Rabindranath Tagore Jayanti.

Loan Services

Highest FD Interest Rates

Bank NameTenureInterest(p.a.)
Esaf Small Finance Bank 12 Months8.75%
Suryoday Small Finance Bank12 Months8.50%
Utkarsh Small Finance Bank12 Months8.50%
Equitas Small Finance Bank 12 Months8.50%
North East Small Finance Bank 12 Months8.50%
Ujjivan Small Finance Bank 12 Months8.30%
Indusind Bank12 Months8.00%
Rbl Bank 12 Months8.00%
Fincare Small Finance Bank Ltd12 Months8.00%
The Nainital Bank 12 Months7.90%

Senior Citizen FD Interest Rates

Bank NameTenureInterest(p.a.)
Esaf Small Finance Bank 12 Months8.75%
Suryoday Small Finance Bank12 Months8.50%
Utkarsh Small Finance Bank12 Months8.50%
Equitas Small Finance Bank 12 Months8.50%
North East Small Finance Bank 12 Months8.50%
Ujjivan Small Finance Bank 12 Months8.30%
Indusind Bank12 Months8.00%
Rbl Bank 12 Months8.00%
Fincare Small Finance Bank Ltd12 Months8.00%
The Nainital Bank 12 Months7.90%

Financial Calculators

Bank Interest Rates