For many purposes we need to take loan. In such a situation, now instead of taking loan from financial institution and bank, we can also take PPF loan. Here we get loan at much lower interest rate than personal loan. If you are also thinking of taking PPF loan, then know how you can apply for it.
New Delhi. If you also invest in Public Provident Fund (PPF), then you get returns on the investment amount. Income can be continued in this fund even after retirement. Loan facility is also provided in PPF.
Let us tell you that the loan available on PPF is much cheaper than personal loan. In such a situation, if you ever need a loan in an emergency, you can take the help of PPF loan. However, PPF Loan has its own rules. Let us know how you can take PPF loan.
How much interest has to be paid on PPF loan
PPF loan is available at very affordable rates. There is no need to pledge any goods to take this loan. This loan is given on the basis of the amount deposited in your PPF account. This loan is given at the rate of 8.1 percent. At the same time, interest of 7.1 percent is available on PPF account (Personal Loan).
Personal loan interest rates range from 10.50 percent to 17 percent or 18 percent.
PPF loan terms and conditions
- To apply for PPF loan, your PPF account should be at least one financial year old.
- When your PPF account becomes 5 years old then you can apply for a loan.
- You can take only up to 25 percent of the amount as loan from PPF account.
- PPF loan facility is available only once. This means that if you apply for a loan again, you will not get the loan.
How to apply for PPF loan
- You will have to go to the branch of the bank where your PPF account is opened and fill the form for the loan.
- Form-D will have to be filled for PPF loan in State Bank of India (SBI).
- In the form, you will have to write the repayment period along with the loan amount.
- If you have taken any loan then you will also have to give this information in that form.
- After this you will also have to submit the PPF passbook () along with the form.
- After the entire loan process, the loan amount will be credited to your bank account in about a week.