I guess it's fine for fungal infections, but for water purification, it can be rather iffy. The temperature and the pH of the water can affect the results when using it for purification, although it does have value for removing objectionable tastes and odors.

It seems to kill most bacteria, but you may have to increase the dosage and let the water stand up to 24 hrs, and the acidity/alkalinity of the water can affect the results.

It is less reliable on viruses.

From the EPA on use for killing protazoan parasites such as giardia and cryptosporidium:
"No information pertaining to protozoa inactivation by potassium permanganate is available in the literature. However, based on the other disinfectants discussed in this report, protozoa are
significantly more resistant than viruses; therefore, it is likely that the dosages and contact times required for protozoa inactivation would be impractical."
http://www.epa.gov/ogwdw000/mdbp/pdf/alter/chapt_5.pdf

So, I would think if you have something better available, it would be advisable to use it.

Sue