EPF interest rate remains unchanged at 8.5 per cent

EPF interest rate remains unchanged at 8.5 per cent

The decision to recommend 8.5 per cent interest rate to the Finance Ministry was taken by EPFO’s Central Board of Trustees (CBT). The CBT, the apex policy making body of EPFO, decided to retain the existing interest rate at a meeting chaired by Union Labour Minister Mallikarjun Kharge.

Payment of 8.5 per cent interest rate on provident fund deposits, which are of the order of Rs 1.82 crore, is expected to leave a surplus of Rs 6.4 crore during the current fiscal.
The employees’ representatives were in favour of a higher rate of interest of 8.75 per cent, and while arriving at the decision, voiced their dissent.  

At present, there are about 4.49 crore provident fund subscribers and they have been receiving 8.5 per cent interest on their deposits since 2005-06.

The organisation is expected to earn an income of Rs 12,994 crore in 2009-10. During last fiscal, EPFO had to suffer a deficit of Rs 139 crore to maintain interest rate of 8.5 per cent.
This deficit was later made up from the available Contingency Fund of around Rs 150 crore. The EPFO is maintaining interest rate of 8.5 per cent since 2005-06. Before that it remained 9.5 per cent for the three consecutive fiscals from 2002-03. The rate of interest was 11 per cent and 11.25 per cent in 2000-01 and 2001-02 respectively.

DH News Service

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