PPF, SCSS and PMVVY for retirement — rates, lock-in, limits and what replaced PMVVY

For the October–December 2026 quarter, the government kept small-savings rates unchanged: the Public Provident Fund (PPF) pays 7.1% a year and the Senior Citizens' Savings Scheme (SCSS) pays 8.2%. PPF is a long-term savings account with a 15-year lock-in and a yearly cap of ₹1.5 lakh, useful during working life. SCSS is a five-year deposit for people aged 60 and over (and some earlier retirees) with a maximum of ₹30 lakh that pays interest every quarter, useful once you retire. PMVVY (Pradhan Mantri Vaya Vandana Yojana), the LIC-run pension plan for seniors, closed to new subscribers on 31 March 2023; existing policies continue to pay until their 10-year term ends. Both PPF and SCSS are government schemes opened at post offices and authorised banks, with rules notified by the Ministry of Finance.

Rates for October–December 2026

Rates are reviewed every quarter by the Ministry of Finance. For PPF, the rate changes for your existing balance whenever a new rate is notified. For SCSS, the rate at the time you open the account applies for its five-year term, which is why the rate on the day you deposit matters. Confirm current rates on the National Savings Institute or India Post website before investing.

PPF in detail

• Who: any resident individual; one account per person, plus accounts opened by a guardian for a minor. Non-residents cannot open new accounts.
• Deposits: minimum ₹500 and maximum ₹1.5 lakh in a financial year, in one go or in instalments.
• Interest calculation: on the lowest balance between the 5th and the last day of each month, so deposit before the 5th to earn that month's interest.
• Maturity: after 15 complete financial years from the end of the year in which you opened the account. An account opened in June 2026 (FY 2026-27) matures on 1 April 2042.
• Extension: in blocks of five years, with or without further deposits. To extend with deposits, you must apply within one year of maturity.
• Partial withdrawal: once a year from the seventh financial year, up to a limit linked to your earlier balance.
• Loans: from the third to the sixth year, against a share of the balance.
• Premature closure: after five years, only for specified reasons such as serious illness or higher education, with a reduction in the interest rate.

These PPF rules are set by the Public Provident Fund Scheme, 2019, made under the Government Savings Promotion Act, 1873. We could not open the official gazette text when checking this page, so confirm withdrawal and loan limits with your post office or bank before you rely on them.

Worked example (illustrative). ₹1,50,000 deposited by 5 April every year for 15 years at an assumed constant 7.1% grows to about ₹40.7 lakh, of which ₹22.5 lakh is your deposits. The rate will not stay constant for 15 years in reality. Run your own numbers in the retirement corpus calculator (enter ₹12,500 a month).

SCSS in detail

• Who: individuals aged 60 or over; those aged 55–60 who retired on superannuation or voluntary retirement, if they invest within one month of receiving retirement benefits; retired defence personnel aged 50 or over (subject to conditions).
• Deposit: multiples of ₹1,000, up to ₹30 lakh in total across all SCSS accounts held by the person. A joint account can be held with a spouse only, and the whole amount counts against the first holder.
• Interest: paid on the first working day of April, July, October and January.
• Term: five years, extendable for further blocks of three years at the rate applicable on the date of maturity.
• Premature closure: before one year, interest paid is recovered; between one and two years, a 1.5% deduction from the principal; after two years, a 1% deduction. These SCSS rules come from the Senior Citizens' Savings Scheme, 2019 as amended; we could not open the official notification text when checking this page, so confirm eligibility, extension and closure deductions with your post office or bank.

Worked example (illustrative). ₹30,00,000 at 8.2% pays ₹2,46,000 a year, which is ₹61,500 each quarter (about ₹20,500 a month). The interest is taxable as income, and the post office or bank may deduct TDS above the threshold unless the right declaration is filed.

PMVVY: what happened

PMVVY was a government-subsidised pension plan for people aged 60 and over, sold by LIC, which paid a guaranteed pension for ten years and returned the purchase price at the end. The subscription period ended on 31 March 2023, and it has not been reopened as of October 2026. If you hold a PMVVY policy, pensions continue until maturity. Anyone offering a "new PMVVY" policy today is likely mis-selling another product; check with LIC directly.

Using these schemes in a retirement plan

A common pattern is to put up to ₹30 lakh per spouse in SCSS at retirement, buy an annuity with part of the NPS corpus, and keep the rest in a mix of deposits and conservative funds. The retirement income plan example shows how the numbers work.

Related: the 2026 overview and EPF contributions.

Frequently asked questions

Is PPF interest tax-free?

PPF interest and maturity have been exempt under income tax law. Tax rules can change; check the current Act before relying on it.

Can I open more than one SCSS account?

Yes, but the total across all your accounts cannot exceed ₹30 lakh.

What happens to SCSS on the holder's death?

The account is closed and the money, with interest up to the date of death at the scheme rate, is paid to the nominee or legal heir. A spouse who is a joint holder or sole nominee and is eligible may continue the account under the rules.

Can I extend PPF after 15 years without depositing?

Yes. If you do nothing, the account continues without deposits and keeps earning interest; you can withdraw from it once a year.

Official sources

• National Savings Institute — scheme rules and current rates
• India Post — opening and operating post office accounts
• Department of Economic Affairs — quarterly rate notifications
• LIC — existing PMVVY policies