When PPF Account becomes inactive?
The PPF account holder needs to deposit the minimum amount of Rs 500 every year in the PPF account to keep the account active. If he misses depositing Rs. 500/- in any financial year, his PPF account will become inactive.
Following facilities cannot be availed by the PPF account holder, if his PPF account is inactive:
- Loan is not granted
- Partial withdrawal is not permissible
- Interest will not be calculated for all those years for which the account is inactive
How to Reactivate PPF Account?
In order reactivate the inactive PPF account, the PPF account holder has to pay a penalty of Rs. 50/- per year for all those years during which the account was inactive along with the arrears of minimum subscription of Rs. 500/- for each such year.
After the revival of account, the interest will be calculated on the balance held in the account at time of revival.
What if PPF account is not activate at the Time of Maturity?
If your PPF account gets discontinued or inactive any time during the tenure of your PPF account then the amount which has already been deposited in the PPF account will continue to earn interest till maturity.
If you want to make PPF withdrawal of the accumulated amount on its maturity, you will be required to pay the penalty accrued for the whole period of deactivation at the rate of Rs. 50 per year of deactivation. For Example, if you have deposited money in your PPF account till 10 years continuously from the opening of your account but have not deposited any amount from 11th year onwards. Then on its maturity, i.e. after 15 years, you will need to deposit Rs 50 each for 5 years (from 11th year to 15th year) means total of Rs 250 will need to be deposited by you towards penalty for 5 years of deactivation of your PPF account, in order to withdraw the accumulated amount on the maturity of your PPF account.