PPF Deposit Before the 5th: How Much Extra Interest Do You Earn?

The short answer

PPF interest for each month is calculated on the lowest balance between the close of the 5th day and the end of that month. A deposit that reaches your account on or before the 5th earns interest for that month; one made on the 6th earns nothing until the next month. At the current 7.1% rate, ₹1.5 lakh deposited by 5 April earns ₹10,650 in the year, while the same amount deposited on 6 April earns ₹9,762.50. You can model the full 15 years with the PPF Calculator, which assumes deposits at the start of each year.

This guide explains the general rules and is not tax advice.

The rule, in the scheme's own words

The Public Provident Fund Scheme, 2019 says interest is calculated "on the lowest balance at the credit of an account between the close of the fifth day and the end of the month", and that interest is "credited to the account at the end of each year".

Two things follow from this:

• The 5th is the cut-off. A deposit made on or before the 5th is part of that month's lowest balance. A deposit made later is not.
• Interest is worked out monthly but added yearly. Each month's interest is calculated and held, then added to your balance on 31 March. It starts earning interest itself from the next financial year.

The same scheme sets the deposit limits: at least ₹500 and at most ₹1.5 lakh in a financial year, in multiples of ₹50.

The current rate

For the October to December 2026 quarter, the government left the PPF rate unchanged at 7.1% a year. Small savings rates are reviewed every quarter, so the rate can change. The worked examples below assume 7.1% throughout, which is a simplification, not a forecast.

Example 1: one ₹1.5 lakh deposit in the year

At 7.1%, each month that ₹1.5 lakh counts towards your lowest balance earns 150,000 × 7.1% ÷ 12 = ₹887.50.

Deposit date	Months that earn interest	Interest for the year
On or before 5 April	12 (April to March)	₹10,650
6 April	11 (May to March)	₹9,762.50
On or before 5 March	1 (March)	₹887.50

Missing the 5 April cut-off by a day costs one month: ₹887.50 in the first year. Leaving the deposit until the last month of the year costs eleven months.

Example 2: the gap over 15 years

Now repeat the same deposit every year for 15 years, with the year's interest credited each March and earning interest from the following year. Assuming 7.1% for the whole period:

Pattern	Approximate balance after 15 years
₹1.5 lakh on or before 5 April every year	₹40,68,209
₹1.5 lakh on 6 April every year	₹40,45,735
₹1.5 lakh in March (by the 5th) every year	₹38,20,989

Depositing by 5 April rather than one day later adds about ₹22,500 over 15 years. Depositing at the start of the year rather than at the end adds about ₹2.47 lakh. The total amount you put in is the same ₹22.5 lakh in every row.

The first figure is what the Lazyblink calculator shows for ₹1.5 lakh a year, 7.1% and 15 years, because it adds each year's money at the start of the year. If you usually deposit later, your actual balance will be lower than the calculator's figure.

Example 3: monthly deposits

Many people put in ₹12,500 a month instead of a lump sum. The date still matters each month.

Monthly ₹12,500 deposit	Interest in year 1	Approximate balance after 15 years
On or before the 5th of every month	₹5,768.75	₹39,44,599
After the 5th of every month	₹4,881.25	₹39,22,125

Paying by the 5th earns about ₹888 more in the first year and about ₹22,500 more over 15 years. Notice also that monthly deposits, even on time, end up below a single deposit by 5 April (₹39.4 lakh against ₹40.7 lakh), because money paid in later months has fewer months to earn.

How to make sure the deposit counts

Pay a few days early. A transfer on the 5th itself can land late if it is a weekend, a bank holiday or done after cut-off hours. Aim for the 1st to the 3rd.

Check the credit date, not the payment date. What counts is when the amount is credited to your PPF account. Look at the passbook or statement entry.

For 5 April, plan in March. The financial year ends on 31 March, and the first days of April are busy for banks. Schedule the transfer for 1 or 2 April if you can.

Use standing instructions for monthly deposits. Set them for the 1st or 2nd of the month rather than the 5th.

Remember the ₹1.5 lakh cap. Anything above ₹1.5 lakh in a financial year does not earn interest, and an early deposit does not change that.

Is it worth stretching to deposit early?

The extra interest is real but modest compared with the total. On ₹1.5 lakh a year it is about ₹887.50 per month of delay. If depositing early means breaking an FD or paying a penalty somewhere else, do the sum first; an FD calculator shows what you would give up there.

If your cash flow only allows monthly deposits, the simple habit of paying by the 5th captures most of the benefit available to you.

Using the calculator

Open the PPF Calculator.

Set the yearly contribution (₹500 to ₹1.5 lakh), the rate (default 7.1%) and the period.

Read the maturity value, total invested and total interest, and the year-by-year table.

Remember the result assumes the full amount goes in at the start of each year. Treat it as the best case for that rate.

For the maturity figure at the maximum deposit, see PPF maturity amount for ₹1.5 lakh a year. If you are reaching the end of 15 years, PPF extension with or without contribution explains the options.

This guide explains the general rules and is not tax advice.