Can you take money out of your PPF early? Here’s what the rules say

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For many Indians, the Public Provident Fund (PPF) is one of the most trusted ways to build long term savings. It offers tax benefits, a steady interest rate of 7.1 percent for October to December 2025, and the security of government backing. But while it is designed as a 15-year investment, people often wonder whether they can withdraw money before maturity. The answer is yes, but only under specific conditions.

The lock-in period

PPF comes with a mandatory 15-year lock-in. This means you cannot close the account and take out the entire balance before this period ends. However, the rules are not as rigid as they seem, because partial withdrawals are allowed once the account has completed six years. From the seventh financial year onwards, account holders can begin withdrawing a portion of their savings if needed.

Partial withdrawal rules

Withdrawals are restricted so that the account balance continues to grow. The amount you can withdraw is whichever is lower between half the balance at the end of the fourth year or half the balance at the end of the year before the withdrawal. This ensures that while you can access some funds for emergencies, your savings are not fully depleted.

Premature closure option

Since 2016, the government has also allowed premature closure of PPF accounts, but this is permitted only after five years and only under special circumstances. These include medical treatment for serious illness for yourself or your dependents, or expenses related to higher education for yourself or your children. If you choose this option, you face a penalty in the form of reduced returns, as the balance will earn one percent lower interest than the prevailing PPF rate.

Loan against PPF

Another alternative to withdrawing funds is taking a loan against your PPF balance. Between the third and sixth financial years of the account, you can borrow up to 25 percent of the balance. The loan needs to be repaid within 36 months, but the advantage here is that it allows you to meet your financial needs without permanently reducing your savings.

What happens after maturity?

Once the 15-year lock-in ends, you are free to withdraw the entire balance. You also have the option of extending the account in blocks of five years, with or without fresh contributions. Many investors choose this extension because the money continues to earn tax-free interest while remaining safe and liquid.