In a significant relief for millions of Public Provident Fund (PPF) account holders, the Union Government has announced that no charges will be levied by financial institutions for updating or modifying nominee details in PPF accounts. The move follows the latest amendment in the Government Savings Promotion General Rules, 2018, notified via Gazette Notification No. 02/4/25.
The Ministry of Finance, through this amendment, has mandated all financial and banking institutions to provide nominee update services free of cost, effective April 2, 2025. This change comes amid widespread reports that banks were charging up to Rs 50 for updating nomination details in government savings schemes like the PPF.
Finance Minister Responds to Public Concerns
Union Finance Minister Nirmala Sitharaman, in a post on microblogging platform X (formerly Twitter), addressed the issue directly.
She stated, "Recently I was informed that a fee was being levied by financial institutions for updating/modifying nominee details in PPF accounts. Necessary changes are now made in the Government Savings Promotion General Rules 2018 to remove any such charges."
As per the amended rules, Schedule II of the 2018 Rules now deletes the clause "(b) Cancellation or change of nomination - Rs 50", making the process entirely fee-free.
Linked to the Banking Laws (Amendment) Bill 2025
The rule change aligns with the provisions of the Banking Laws (Amendment) Bill 2025, which was recently passed by Parliament. The bill allows nomination of up to four individuals for amounts held in savings accounts, fixed deposits, safe custody, and lockers, aimed at easing claim settlements and reducing legal disputes among heirs.
What is the PPF?
The Public Provident Fund (PPF) is one of India's most popular long-term savings schemes, offering tax-free returns and a sovereign guarantee. With a minimum annual investment of Rs 500 and a maximum cap of Rs 1.5 lakh, PPF has been a go-to investment tool for conservative savers since its inception under the PPF Act, 1968.
In line with the government's efforts to simplify small savings schemes, a proposal has also been floated to merge the Government Savings Certificates Act, 1959, and the PPF Act, 1968, with the Government Savings Banks Act, 1873, to ensure uniformity in the legal framework.
Key Highlights
- No more Rs 50 charges for changing PPF nominee details.
- Amended Rules effective from April 2, 2025.
- Up to four nominees can now be added under the revised banking laws.
- Government pushing for simplification and standardization of small savings schemes.
This step is expected to benefit crores of small savers and investors, ensuring better customer service and smoother claim processes in the future.
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