Earlier in my article on “Should PPF account be part of your Retirement Corpus?” I had discussed rules of PPF scheme and how it can become part of your Retirement Corpus. In last few days I have heard many investors, complaining on service issues with Post office on PPF account. Investors believe that PPF account which is opened with Post office can be transferred to another Post Office only and not to Nationalized Bank. This is not true you can transfer PPF account from Post Office to Nationalized Banks. This article is an effort to guide investors on “How they can transfer their PPF Account from Post Office to Nationalized Bank smoothly”.
PPF is a central Govt. scheme and one can open PPF Account with post office and Nationalized Banks. Rules and regulations are same. Till now lot of investors have opened their PPF accounts with post office because in post office there were more agents working and they were ready to help clients for their commissions. But after words, commission to agents on PPF account was discontinued so now agents have lost their interest in PPF account deposits and services. As a result PPF account holders are facing lots of problems because of poor services of post office.
Let us first understand, What are the drawbacks of Having PPF Account with Post office?
1.Manual system of operation vs. computerized system:
Most of the post offices still operate PPF account in manual books. Due to this, chances of human error in making entries and calculating interest are very high. I have seen many investors who receive letter from post office to deposit their PPF passbooks saying they have found mistake in their entries so they need passbooks to tally the balance. Many times balance in branch post office and head post office does not tally. This is very risky because PPF is a long term investment and depositors may continue their accounts for more than 15 years so if there are mistakes in balance it can become difficult to tally accounts over such long periods.
2.Online banking is available with Nationalized Banks:
With your PPF account at Nationalized Banks you can view your PPF account online and even transfer money from saving account to PPF account. This saves your time and hassle to visit post office physically.
So it is advisable to transfer you PPF account from post office to Nationalized Bank.
How to transfer your PPF account from Post office to Nationalized Bank?
Step-1 Check your entries first:
Before you submit your passbook for transfer, check your deposit entries and interest entries accurately and take photocopy of all pages of passbook.
Step-2 Application for transfer:
Write down a simple application for transfer of PPF Account to nationalized bank along with name and branch of the bank. Ideally PPF account should be transferred to that branch of bank where you have your regular saving account. You also have to fill up form SB 10(b) of post office, which you can download from here form SB 10(b). Along with form and application you have to submit a self attested copy of your PAN Card and self attested copy of address proof.
Step-3 Transfer of account to Bank:
On receipt of your application, concerned post master will make all the verification and close the PPF Account with post office and transfer your balance through demand draft or account payee cheque in concerned branch of bank along with certified copy of ledger and original records like application form for opening account, nomination details , specimen signature etc.
Step-4 Account opening in Bank:
Now the bank will open your PPF account with balance transferred and issue new passbook to you which you can collect.
What care should be taken in transfer process?:
Following points should always be considered during this transfer process.
► Don’t forget to take copies of all document and passbook of post office. This will help you in claiming your income tax deduction because new passbook which you will get from bank will not have old entries.
►If post office employees disagree to transfer your PPF account to bank by saying that it doesn’t happen, show them rule 153 of Chapter IV of Post Office Saving Bank Account Manual vol. 1, second schedule which clearly has give for such type of transfer. You can download the link from here Chapter IV of Post Office Saving Bank Account Manual.
In my opinion, investors should transfer their PPF account from post office to bank at the earliest to ensure better services.