Currently, the government reviews the interest rate applicable to the EPF scheme on a yearly basis
Retirement fund body Employees' Provident Fund Organisation (EPFO) will pay interest at the rate of 8.5 per cent for the current financial year, Labour Minister Santosh Gangwar said on Thursday. That marked a cut of 15 basis points - or 0.15 percentage point - from the interest rate of 8.65 per cent paid on EPF investments for financial year 2018-19. The move is likely to impact around six crore subscribers of the provident fund scheme. (Also Read: How To Apply For A PF Withdrawal Online)
The decision was taken at a meeting of the Central Board of Trustee (CBT), which is the top decision-making body of the EPFO. “The Central Board of Trustees (CBT) has decided to decrease the rate of Employees' Provident Fund (EPF),” Mr Gangwar said after the meeting.
With the proposed revision, the EPF interest rate stands reduced to a level last seen in financial year 2012-13.
EPF Interest Rate
| Year | EPF Interest Rate |
|---|---|
| 2019-20 | 8.50% |
| 2018-19 | 8.65% |
| 2017-18 | 8.55% |
| 2016-17 | 8.65% |
| 2015-16 | 8.80% |
| 2014-15 | 8.75% |
| 2013-14 | 8.75% |
| 2012-13 | 8.50% |
The minister also said that the EPFO will have a surplus of over Rs 700 crore after providing the new interest rate for the current financial year.
After clearance by the Central Board of Trustees, the proposal is sent to the Finance Ministry. The interest amount is credited to the accounts of the subscribers after the Finance Ministry gives nod to the proposed rate.
For financial year 2017-18, the retirement fund body had kept the interest rate steady at 8.55 per cent, after revising it to a four-year low the previous year.
Currently, the government reviews the interest rate applicable to the provident fund (PF) scheme for salaried individuals on a yearly basis.
