The government has approved 8.1 percent interest rate on Employees’ Provident Fund (EPF) deposits for the financial year 2021-22. The EPFO office has given this information on Friday. The EPFO has taken this decision after discussions with the Finance Investment and Audit Committee of EPFO.
The government has approved 8.1 per cent interest rate on Employees’ Provident Fund (EPF) deposits for 2021-22, the lowest level in four decades, for nearly five crore subscribers of the retirement fund body.
The Employees’ Provident Fund Organization (EPFO) took this decision after talks with the Central Board of Trustees and the Finance Investment and Audit Committee of the Employees’ Provident Fund Organization (EPFO).
Let us inform that in the financial year 2020-21, EPFO had decided to give 8.50 percent interest. Talking about the figures, the interest rate on PF for the financial year 2022 of the Employees’ Provident Fund Organization is the lowest in 40 years (four decades) i.e. 8.1 percent. 15 percent of the money deposited in EPFO is invested in equity and the rest in debt.
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. The Ministry of Labor and Employment had sought the approval of the Central Government to credit 8.1 per cent interest rate for 2021-22 to each of the members 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 rate of interest for the financial year in EPF accounts.
The EPF rate is the lowest since 1977-78
at 8.1 per cent, the lowest since 1977-78, when it was 8 per cent. 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. After this, the EPFO issued instructions to the field offices to deposit the interest income in the account of customers at 8.5 percent for 2020-21.
When was the interest rate?
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. At the same time, 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 had given 8.75 per cent interest in 2013-14 as well as 2014-15, which is higher than 8.5 per cent in 2012-13. Its interest rate in 2011-12 was 8.25 percent.
