What is the full form of 'PPF', the popular long-term savings scheme?

The PPF is a long-term savings scheme backed by the Government of India. It was introduced in 1968 by the National Savings Institute of the Ministry of Finance, with the aim of encouraging small savings and providing a safe investment option with tax benefits.

A PPF account can be opened at a post office or at authorised banks by any resident Indian, including for a minor. The account has a lock-in period, or maturity, of 15 years, which can be extended in blocks of five years after maturity. A minimum deposit of ₹500 and a maximum of ₹1.5 lakh can be made in a financial year. The interest rate is fixed by the government every quarter, and the interest is compounded annually. Partial withdrawals and loans against the balance are allowed after a few years, under certain conditions.

The PPF is popular because it is very safe, as it is backed by the government, and because it enjoys "EEE" (Exempt-Exempt-Exempt) tax status: the money invested qualifies for a deduction under Section 80C of the Income Tax Act, and both the interest earned and the amount received at maturity are tax-free.

Other small savings schemes of the government include the National Savings Certificate (NSC), Kisan Vikas Patra (KVP), Sukanya Samriddhi Yojana (for the girl child, 2015), the Senior Citizens' Savings Scheme and the Post Office savings account. These are different from the Employees' Provident Fund (EPF), which is for salaried employees and is managed by the Employees' Provident Fund Organisation (EPFO).

In economics, "PPF" can also mean the Production Possibility Frontier, a curve showing the combinations of goods an economy can produce with its resources.

Why not the other options?

• ✗Personal Pension Fund is not the expansion of PPF.
• ✗Public Pension Facility is not the expansion of PPF.
• ✗Private Provident Fund is incorrect; the PPF is a government-backed scheme.