Non-Resident Indians (NRIs) can maintain their existing PPF accounts but cannot open new ones under current regulations. According to reports from Mint, NRIs must continue making the minimum deposit of ₹500 per financial year to keep their accounts active during the original 15-year tenure. If this minimum contribution is not maintained, the account may become inactive and require reactivation through prescribed procedures and penalties. NRIs who opened their PPF accounts while resident Indians are permitted to continue contributing to their existing accounts during this period, but cannot extend the tenure beyond 15 years.
The PPF currently offers an interest rate of 7.1% per annum, which is revised quarterly and compounded annually. As reported by Mint, depositors can invest a maximum amount of ₹1.5 lakh in PPF every financial year, with the same limit applying to NRIs. The PPF enjoys one of the most favourable tax treatments among investment options in India, falling under the EEE (Exempt-Exempt-Exempt) category. Contributions are eligible for tax deduction under Section 80C of the Income Tax Act, up to ₹1.5 lakh in a financial year, and the interest earned is completely tax-free. Additionally, maturity proceeds are entirely exempt from tax, ensuring investors receive the full benefit of their accumulated corpus without any deductions.
Once the PPF account matures, the accumulated corpus must be credited to the individual's Non-Resident Ordinary (NRO) account. According to Mint, the PPF balance is non-repatriable, which means it cannot be directly transferred abroad. However, funds in an NRO account can be remitted overseas up to $1 million (around ₹8.3 crore) per financial year, after paying applicable taxes, according to guidelines set by the Reserve Bank of India (RBI). When an individual becomes an NRI, they must inform their bank or financial institution about the change in residential status, as the PPF proceeds will be transferred to this account upon maturity. The bank will then convert the existing savings account into an NRO account, ensuring compliance with foreign exchange regulations prescribed under FEMA and RBI guidelines.
Despite improvements, OTP-related disruptions continue to be one of the biggest pain points for NRIs managing Indian banking remotely. The most common issues include delayed OTPs, SMS failures, SIM deactivation and blocked messages from Indian banking short codes. As reported by SBNRI, NRIs often face issues like OTP non-delivery, delays due to international SMS routing, or complete loss of access if their Indian SIM gets deactivated, which can disrupt critical transactions like investment redemptions, large transfers, or tax filings. International carriers sometimes block SMS from Indian short codes, which is one of the top complaints from NRIs. To reduce these risks, experts recommend maintaining a dual setup - keeping an Indian number as backup while registering an international number as primary and enabling app-based authentication as the most reliable layer. Many NRIs now maintain their Indian SIM purely for banking and OTP purposes, typically activating international roaming and ensuring periodic recharges to avoid inactivity-related disconnection.
