Government approves 8.1 percent interest rate on Employees’ Provident Fund (EPF) deposits for 2021-22
The government has approved 8.1 per cent interest rate on Employees’ Provident Fund (EPF) deposits for 2021-22 – a low of over four decades – for nearly five crore subscribers of EPFO.
Earlier in March this year, the Employees’ Provident Fund Organization (EPFO) had decided to reduce the interest on provident fund deposits for 2021-22 from 8.5 per cent provided in 2020-21 to 8.1 per cent.
According to an EPFO office order issued on Friday and reviewed by PTI, the Ministry of Labor and Employment has conveyed the Central government’s approval to credit 8.1 per cent interest rate for 2021-22 to each member of the EPF scheme.
The Labor Ministry had sent the proposal to the Finance Ministry for consent.
Now, after the ratification of the interest rate by the government, EPFO will start depositing fixed interest rate for the financial year in the EPF accounts.
The 8.1 percent EPF rate of interest is the lowest since 1977-78, when it was 8 percent. The Central Board of Trustees (CBT) had fixed an interest rate of 8.5 per cent on EPF deposits for 2020-21 in March 2021.
This was ratified by the Finance Ministry in October 2021. Thereafter, the EPFO issued instructions to the field offices to credit the interest income at 8.5 per cent in the account of subscribers for 2020-21.
EPFO trustee, KE Raghunathan, who represents the employers, said the speed with which the labor and finance ministries have approved the interest rate is indeed commendable, given the dire need of funds in the hands of employees and this They will be helped to meet such expenses. As to the educational needs of your children.
In March 2020, the EPFO had reduced the interest rate on provident fund deposits from a seven-year low of 8.5 per cent for 2019-20 to 8.65 per cent in 2018-19.
The EPF interest rate provided for 2019-20 was the lowest since 2012-13, when it was reduced to 8.5 per cent. EPFO had provided 8.65 per cent interest rate to its subscribers in 2016-17 and 8.55 per cent in 2017-18.
The interest rate was slightly higher at 8.8 per cent in 2015-16. It paid 8.75 per cent interest in 2013-14 as well as 2014-15, up from 8.5 per cent in 2012-13. The interest rate in 2011-12 was 8.25 per cent.