Who controls each one, and how contributions work
EPF (Employees' Provident Fund) is mandatory for most salaried employees: 12% of basic salary + DA from the employee, matched by 12% from the employer (a portion of the employer's share is diverted to the EPS pension scheme rather than the EPF corpus). Employees don't choose the contribution rate or where it's invested — EPFO manages it centrally and declares an annual interest rate (8.25% for FY 2025-26).
NPS (National Pension System) and PPF (Public Provident Fund) are both voluntary — you decide whether to open an account and how much to contribute (within scheme limits). NPS is market-linked: your contributions buy units in equity/debt/government-bond funds you choose, so the return isn't fixed and depends on market performance. PPF pays a fixed rate set quarterly by the Ministry of Finance (7.1% for the Jul-Sep 2026 quarter), guaranteed regardless of market conditions.
A worked comparison over a 30-year horizon
Take a 30-year-old contributing for 30 years (to age 60) in each scheme: EPF from a ₹30,000/month basic salary with a 5% annual increase (12% employee + employer contribution) grows to a corpus of about ₹1,69,12,046, of which about ₹1,16,21,550 is interest. NPS contributing ₹12,500/month (matching PPF's ₹1,50,000/year ceiling) at an assumed 10% average annual return grows to a much larger corpus of about ₹2,84,91,567 — but 40% of that (about ₹1,13,96,627) must go into an annuity, leaving a lump-sum withdrawal of about ₹1,70,94,940 plus an estimated monthly pension of about ₹56,983. PPF at ₹1,50,000/year for 30 years grows to about ₹1,54,50,911, all tax-free and fully accessible at maturity with no annuity requirement.
The NPS figure is the largest specifically because of its market-linked return assumption (10%) versus EPF's and PPF's guaranteed, government-set rates (8.25% and 7.1%) — in a weaker market year, NPS could well underperform both. This is the core trade-off: NPS offers higher expected growth in exchange for return uncertainty and a mandatory annuity lock-in on part of the corpus that EPF and PPF don't impose.
Tax treatment differs meaningfully
EPF and PPF are both "EEE" (Exempt-Exempt-Exempt) under the old tax regime: contributions are deductible under Section 80C, interest earned is tax-free, and maturity withdrawal is tax-free (subject to EPF's minimum service conditions). NPS contributions get their own additional deduction — up to ₹50,000/year under Section 80CCD(1B), over and above the ₹1.5 lakh Section 80C limit — but NPS withdrawals are only partially tax-free: the lump sum portion is tax-free up to scheme limits, while annuity income is taxed as regular income when received.
Which one should you prioritize?
EPF isn't really a choice for salaried employees above the wage threshold — it's mandatory, so it forms the guaranteed base of most people's retirement savings by default. Beyond that, PPF suits savers who want a second fully guaranteed, tax-free option with no market risk, while NPS suits those willing to accept market-linked volatility for potentially higher growth and the extra ₹50,000 Section 80CCD(1B) deduction. Many salaried savers use EPF plus one or both of the other two, rather than treating this as an either-or choice — the schemes are complementary, not competing, since only one (EPF) is mandatory in the first place.