Don't have minimum PPF balance? This is what could happen

The Public Provident Fund or PPF is one of the most popular and preferred modes of small savings. In fact, this long-term investment scheme is backed by the government and gives individuals an attractive interest rate along with safety and security. Adding to this, the returns is exempted of tax. In the PPF, individuals can invest minimum Rs 500 to a maximum of Rs 1,50,000 per annum. In other terms, one can invest up to a maximum of Rs 12,500 per month. If excess, the amount will not earn any interest on it. Moreover, the amount will not eligible for rebate under Income Tax Act.

But, if one fails to pay a minimum amount of Rs 500 the individual will be levied Rs 50 each year. Along with this, arrears of subscription of Rs 500 will also be levied. Furthermore, the account is deemed as discontinued or inactive, due to which the account cannot be closed before the maturity period. Moreover, one cannot avail the returns when the PPF account is in the inactive status. 

To re-activate or revive the PPF account, you need to present a written application claiming for the same at the bank or the nearest postal office. The defaulter will be charged with Rs 50 each year for non-payment, along with a minimum contribution of Rs 500 as arrears for each year of non-payment. 

For example, if one does not pay the PPF amount an d the account remains inactive for 4 years and then you wish to reactivate, the you need to pay Rs 50 for the next 4 years i.e Rs 200.
Moreover, one needs to deposit Rs 500 for 4 years i.e Rs 2000.