The Department of Posts has issued a circular on October 18, 2021, detailing the process of merging multiple PPF accounts into a single PPF account. According to the circular of the Department of Posts, how can more than one PPF account be merged.
As per the rules of Public Provident Fund i.e. PPF scheme, a person cannot have more than one account. However, many people still unknowingly open more than one PPF account. They must have opened PPF accounts in two different banks or post offices and also in one bank. So, what kind of consequences may have to be faced in such a situation and what can be done in these situations, let us also tell you.
The Department of Posts has issued a circular on October 18, 2021, in which the process of merging multiple PPF accounts into a single PPF account has been explained. According to the circular of the Department of Posts, how can more than one PPF account be merged.
If if the PPF deposit does not exceed the prescribed limit
An individual will have the option to maintain a PPF account of his choice, provided the amount deposited in both the accounts is within the prescribed deposit limit (currently it is Rs 1.5 lakh per financial year). If the PPF accounts are in the same operating agency (let’s say you have more than one PPF in different banks or two accounts in the post office), then the process of transfer of PPF account can be easily merged using .
However, it may happen that PPF accounts are opened with any bank and post office (i.e., different operating agencies), in such case, the PPF account holder will have to submit a request for merger of PPF account. Either with the bank or the post office where he wants to maintain the PPF account. The merger request has to be submitted along with a photocopy of the PPF passbook / account details. Once the request is submitted, the PPF account office will send the details to the other office where the PPF account is to be merged.
The office where the PPF account is to be maintained will calculate the annual deposit amount made by the account holder in all the PPF accounts. Keep in mind that the annual deposit should not exceed the prescribed deposit limit announced by the government. Once it is confirmed that the deposit has not breached the prescribed limit, the request for account closure and balance transfer will be sent to another office.
The date of opening of the written account will be reckoned as the actual date of opening of the PPF account. This date will be considered for maturity calculation and other purposes like loan, withdrawal etc. Further, the date of transfer/credit of balance in the PPF account maintained will be treated as the date of credit for the purpose of loan/exit.
If PPF deposit exceeds the prescribed limit
There may be a situation where the amount deposited in multiple PPF accounts at the same time exceeds the prescribed limit. In such a situation, the excess amount that violates the prescribed deposit limit in PPF accounts will be refunded to the individual after the account is merged. This amount will be refunded without any interest. The PPF Account Office will adjust the interest before transferring the balance to the maintained PPF account. Here also, the date of opening of the written account will be treated as the date of actual opening of the PPF account. This date will be considered for calculation of maturity and other purposes like loans, withdrawals etc. Further, the date of transfer/credit of balance in the PPF account maintained will be treated as the date of credit for the purpose of loan/withdrawal etc.
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