Employee Provident Fund (EPF) Interest Rate Cut To 8.50%, To Impact 6 Crore
Currently, the government reviews the interest rate applicable to the provident fund scheme for salaried individuals 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 MinisterSantosh 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 more than six crore subscribers of the provident fund scheme.
“The Central Board of Trustees (CBT) have decided to decrease the rate of Employees’ Provident Fund (EPF),” Mr Gangwar said. The Central Board of Trustees is the top decision-making body of the Employees’ Provident Fund Organisation (EPFO).
With the proposed revision, the EPF interest rate stands reduced to a level last seen in financial year 2012-13. (Also Read: How To Apply For A PF Withdrawal Online)
EPF Interest Rate
| Year | EPF Interest Rate |
|---|---|
| 2019-20 | 8.50% |
| 2018-19 | 8.65% |
| 2017-18 | 8.55% |
| 2016-17 | 8.55% |
| 2015-16 | 8.80% |
| 2014-15 | 8.75% |
| 2013-14 | 8.75% |
| 2012-13 | 8.50% |
Once the approval of Central Board of Trustees is in place, the proposal is sent to the Finance Ministry. It is only after the clearance of the Finance Ministry that the interest at the new rate is credited in the accounts of subscribers.
For financial year 2017-18, the retirement fund body had kept the interest rate steady at 8.55 per cent – the lowest interest rate recorded in five years. It had provided interest at the rate of 8.8 per cent to the subscribers for financial year 2015-16.
Currently, the government reviews the interest rate applicable to the provident fund (PF) scheme for salaried individuals on a yearly basis.
