Bank of Maharashtra was founded in 1935 with its headquarters in Pune and was nationalised in 1969. The banking institution is one of the major public sector banks in the country and has more than 1897 branches pan India.
The financial institution is famous for its exceptional consumer and investment banking, corporate banking and other services. Among its financial products and government-backed savings instruments, individuals highly prefer schemes like Bank of Maharashtra PPF Account. To make the most of such savings facility, individuals must find out about its features and other requirements in detail.
What is PPF Account in Bank of Maharashtra?
Fundamentally, a PPF account is a tax saving means of generating wealth. It aims to channel a small portion of an individual’s earnings towards organised savings.
Usually, most leading banking institutions, including Bank of Maharashtra, extend PPF account facility to eligible individuals. Having a PPF account Bank of Maharashtra proves useful in building a corpus for retirement or emergencies and helps to earn guaranteed returns.
Who can Open a PPF Account in Bank of Maharashtra?
Typically, anybody who wishes to generate a steady and safe source of earning can open a Bank of Maharashtra PPF Account. Such an account can be opened at any branch of the said banking institution. So, in brief, individuals with these criteria can open a PPF account at this bank –
- Resident Indians over the age of 18 years.
- A parent or guardian can open a PPF account on behalf of minors.
However, these following pointers must be noted before opening a PPF account.
- Non-resident Indians are not eligible to open this account.
- Bank of Maharashtra PPF account cannot be transferred from its holder to another.
- One cannot hold a PPF account jointly.
- Both parents are not permitted to open a separate PPF account for the same child.
Steps to Open a Bank of Maharashtra PPF Account
Here’s how to open PPF account in Bank of Maharashtra –
Step 1 – Go to Bank of Maharashtra’s official website to download the PPF application form.
Step 2 – Provide essential details to fill the same.
Step 3 – Attach essential documents along with the duly filled form and submit to the nearest branch of the said bank.
Once, these steps are completed, and the essential set of documents is submitted, the banking institution will initiate the verification process. Generally, to open a Bank of Maharashtra PPF account applicants need to submit these documents –
- Form A (Application form)
- Form E (Nomination form)
- PAN card
- Aadhaar Card
- Identity and address proof
- Bank statement
- Recent passport-sized photographs
Notably, the specifications in terms of eligibility and documentation may vary from one type of applicant to another.
Features and Associated Benefits of PPF Account in Bank of Maharashtra
These pointers below highlight the major features and accompanying benefits of Bank of Maharashtra PPF account online.
- Investment amount and frequency
In a financial year, the minimum deposit should be at least Rs. 500 whereas the maximum deposit is capped at Rs. 1.5 lakh. The maximum number of instalments should not exceed 12 in a year. It must be noted that PPF account holders have the option to deposit a lump sum amount or in instalments.
In case account holders fail to maintain the minimum balance requirement; their account will be considered discontinued. To revive such an account, individuals will be required to pay a penalty of Rs. 50.
- Maturity tenure
This PPF account comes with a tenure of 15 years. Unlike the PPF facility offered by other financial institutions, Bank of Maharashtra PPF account online cannot extend the tenure by another 5 years.
- Tax treatment
According to the Income Tax Act, interest earned on Bank of Maharashtra PPF account is exempted from taxation. Also, the deposit amount in the account is exempted from wealth tax.
- Withdrawal facility
Account Holders can withdraw from their PPF account once it has been active for 6 years. Typically, the financial institution allows only one withdrawal that is equivalent to 50% of the balance standing at the end of the 4th year or preceding year (which of two is less).
For example, take a look at this example below to understand how the withdrawal facility works –
Suppose Ms Seema wanted to withdraw money from her PPF account bank of Maharashtra in September 2019. Following is a table illustrating her deposits –
|Year of Investment||Investment Amount (Rs.)||Total Balance (Rs.)|
As per the table corpus at the end of 4th year stood at Rs. 2,20,000. 50% of the amount = Rs. 1,10,000
Corpus at the end of the preceding year stood at Rs. 5,45,000. So, 50% of the amount = Rs. 2,72,500
It indicates that Ms Seema will be able to withdraw Rs. 1.1 lakh in 2020.
- Loan facility
Account holders can avail a loan of at least 25% of the available balance after the account has been active for 3 years.
Account holders have the opportunity to nominate more than one person who can receive the PPF account balance in the event of their death. They can also change or cancel the nomination as and when required.
Individuals can find out more about the features that accompany the Bank of Maharashtra PPF account online from the official website of the financial institution to make an informed decision.
How is Interest Computed on PPF Account?
The interest on PPF account in Bank of Maharashtra is determined according to the quarterly declaration made by the Ministry of Finance. It is computed on the minimum amount between the 5th of a given month and its last day. Also, the interest amount is credited on 31st March of each year.
Individuals can use a PPF calculator to determine the maturity value of their deposits and understand how the Bank of Maharashtra PPF account interest rate impacts their corpus. Doing so, they can formulate a more comprehensive financial plan and meet their respective goals accordingly.