Difference between PPF and EPF
Basis |
Public Provident Fund (PPF) |
|
---|---|---|
Meaning |
It is a long-term savings scheme offered by the Government of India with the primary objective of encouraging individuals to save for their retirement. |
It is a mandatory savings scheme for salaried employees in India, under which both the employee and the employer make contributions towards the provident fund account. |
Type |
It is a voluntary savings scheme available to all individuals. |
It is a mandatory savings scheme for salaried employees. |
Eligibility |
PPF is open to all resident individuals, including salaried employees. |
EPF is applicable to salaried employees only. |
Purpose |
Its purpose is to maintain long-term savings for retirement and enjoy tax benefits. |
It aims at retirement savings, provident fund for employees, and social security. |
Contribution |
The account holder makes the contribution. |
The employer and the employee makes the contribution. |
Contribution Limit |
Minimum Limit: ₹500 per year |
1,800 or 12% on the basic pay and dearness allowance, whichever is lower. |
Interest Rate |
The current interest rate set by the Government of India is 7.1% (FY 2024-2025) |
The current interest rate set by EPFO for the year 2023-2024 is 8.25% |
Tenure |
PPF has a minimum tenure of 15 years, which can be extended in blocks of 5 years according to the individual’s wish. |
The account remains active as long as the individual is employed. |
Portability |
It is not portable as account cannot be transferred between individuals. |
It is portable as account can be transferred between employers or regions. |