In a major relief for Public Provident Fund (PPF) account holders, Finance Minister Nirmala Sitharaman has announced that updating or adding nominees in PPF accounts will now be completely free of charge.
"No fee will be charged for the updation or addition of nominees," the Finance Minister Nirmala Sitharaman stated on Thursday. This move comes after the government made essential changes via a Gazette Notification, and these updates are applicable with immediate effect.
Earlier, financial institutions were charging a fee of Rs 50 for any modification or addition of nominee details in PPF accounts. This had caused concern among account holders, especially those managing long-term investment portfolios through the government-backed savings scheme.
As per the recent Gazette Notification dated April 2, 2025, the Government has officially amended the Government Savings Promotion General Rules, 2018. This amendment removes any charges related to updating or cancelling nominee details for PPF accounts. It also extends to all small savings schemes run by the central government.
"Now, PPF account holders will not longer be required to pay the fee of Rs 50 for cancellation or change of nomination for small savings schemes run by the government," Sitharaman confirmed.
The recently passed Banking Amendment Bill 2025 brings another important change. It now permits up to 4 individuals to be nominated for receiving the depositor's funds, articles in safe custody, and safety locker contents.
In addition to nominee updates, the bill seeks to redefine the term 'substantial interest' of a person in a bank. The new limit will be Rs 2 crore, a significant increase from the earlier cap of Rs 5 lakh, which had remained unchanged for nearly 60 years.
Another noteworthy reform in the bill is the increase in tenure for directors (excluding the chairman and whole-time directors) of cooperative banks. Their term has been extended from 8 years to 10 years, aligning with the Constitution (Ninety-Seventh Amendment) Act, 2011.
The Public Provident Fund (PPF), one of India's most trusted long-term savings schemes, currently offers an annual interest rate of 7.1%, as per the latest small savings scheme update by the government. Investors can contribute a minimum of Rs 500 and a maximum of Rs 1.5 lakh per financial year in a PPF account.
The recent reforms in Public Provident Fund (PPF) nominee rules come as a welcome move for millions of investors. By removing the Rs 50 fee for updating or adding nominees, the government has made small savings schemes more investor-friendly.
This change, implemented immediately through the Gazette Notification dated April 2, 2025, underscores the government’s commitment to simplifying financial procedures for citizens.
With the addition of up to four nominees now permitted under the Banking Amendment Bill 2025, account holders gain better control over their long-term savings plans.
Coupled with a stable 7.1% annual interest rate, PPF continues to be one of the most reliable and rewarding investment options in India. These reforms not only enhance transparency but also align with global best practices, encouraging more individuals to participate in formal financial planning.
Investors should regularly update their nominee details to ensure smooth fund transfer and safeguard their hard-earned savings.