- NRIs cannot open new Public Provident Fund (PPF) accounts after becoming an NRI.
- You can keep your existing PPF accounts opened as resident Indians until they mature, but you can’t extend them.
- Withdrawals and loans are allowed under certain conditions; when the account matures, funds go into NRO accounts and cannot be sent outside India.
Non-Resident Indians (NRIs) are seeking clarity on the rules surrounding Public Provident Fund (PPF) accounts. This financial tool, popular among resident Indians for its tax-saving and long-term savings benefits, comes with specific limitations for NRIs.
PPF Account Eligibility for NRIs
It’s important to know who can open or continue a PPF account as an NRI before you make investment choices.
Can NRIs Open New PPF Accounts?
Government rules don’t allow NRIs, Persons of Indian Origin (PIOs), or Overseas Citizens of India (OCIs) to open new PPF accounts once they become NRIs. The scheme is only for Indian residents.
Continuing Existing PPF Accounts After Becoming NRI
If you started a PPF account as a resident Indian and later became NRI, you can keep contributing to your account until it matures, usually after 15 years. But, unlike residents, NRIs can’t extend the account for an extra five years.
Withdrawal and Closure Rules for NRIs
NRIs have some options for early withdrawal, loans, and closure, but there are specific conditions to follow.
Premature Withdrawal Conditions for NRIs
You can close your PPF account early only after five years from opening it. To do this, NRIs must provide proof of their changed status, like a passport, visa, or recent tax papers. The payout is non-repatriable, which means the money cannot be sent outside India.
Maturity and Closure Procedures for NRI PPF Accounts
When the account matures, NRIs must close it. The funds will be credited only to a Non-Resident Ordinary (NRO) account in India and cannot be transferred abroad. This rule follows official guidelines and foreign exchange laws.
Loan Facility Against PPF for NRIs
NRIs can take loans from their PPF accounts between the 3rd and 6th years after opening. Loans can be up to 25% of the balance at the end of the 3rd financial year. The loan must be paid back within 36 months. This can help with cash needs during the account period.
Nomination and Benefits for NRIs
NRIs can be named as beneficiaries on PPF accounts. But, like account holders, payments to nominees cannot be sent outside India and will go only to their NRO accounts.
| Scenario | Allowed for NRIs? |
|---|---|
| Opening new PPF account as NRI | No |
| Continue existing PPF opened before NRI status | Yes (till maturity) |
| Extend PPF beyond maturity | No |
| Premature withdrawal after 5 years | Yes (with conditions) |
| Funds at maturity repatriability | Non-repatriable (NRO only) |
| Nominate an NRI as beneficiary | Yes (non-repatriable payouts) |
| Take loan against PPF account | Yes (3rd to 6th year) |
| Official PPF Interest Rate (Jul-Sep 2025) | 7.1% p.a. (tax-free) |
| Official Government Website | incometaxindia.gov.in |
PPF Key Points for NRIs
- No new PPF accounts after you become an NRI.
- You can continue your account until maturity if opened as a resident.
- Loans available from 3rd to 6th year.
- Withdrawals need embassy documents.
- Final funds go to NRO account only.
Important Tips
- Keep proof of your NRI status ready for withdrawals.
- Plan investments before you become an NRI.
- Keep track of quarterly interest rate updates.
- Ask your bank about loan rules and process.
Knowing these rules helps you manage your PPF account easily as an NRI. Your existing PPF account will keep giving you tax-free returns until maturity, but remember, the money can’t be sent abroad. It’s always good to talk to your bank or financial advisor for advice that fits your situation.