1. What is a PPF Interest Calculator?

Definition: This calculator estimates the monthly interest earned on a Public Provident Fund (PPF) account based on the minimum balance and current interest rate.

Purpose: It helps investors understand how much interest their PPF account will generate each month.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• Interest — Monthly interest amount ($)
• Min Balance — Minimum balance in the account during the month ($)
• i — Annual interest rate (in decimal form, e.g., 0.071 for 7.1%)

Explanation: The annual interest is calculated on the minimum balance and then divided by 12 to get the monthly interest.

3. Importance of PPF Interest Calculation

Details: Understanding PPF interest helps in financial planning, comparing investment options, and tracking PPF account growth.

4. Using the Calculator

Tips: Enter the minimum balance in dollars and the current interest rate in decimal form (default 0.071 for 7.1%). All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: How is minimum balance determined for PPF?
A: It's the lowest balance in your account between the 5th and last day of each month.

Q2: What's the current PPF interest rate?
A: As of 2023, it's typically 7.1% (0.071 decimal), but this changes quarterly.

Q3: Is PPF interest compounded?
A: Yes, interest is compounded annually but credited monthly.

Q4: When is PPF interest credited?
A: Interest is calculated monthly but credited at the end of the financial year.

Q5: Are there tax benefits on PPF interest?
A: Yes, PPF interest is tax-exempt under Section 10 of the Income Tax Act.