edited by: Mohammad Haris
Last Update: February 13, 2023, 12:41 IST
For 2021-22, the government had approved a four-decade-low interest rate of 8.1 per cent on Employees’ Provident Fund deposits.
The meeting of the Central Board of Trustees of EPFO is likely to be held later this month or early March to decide on the interest rate
The government may fix the interest rate on PF deposits for the financial year 2022-23 at around 8 per cent, which is almost the same as the previous financial year. at The report quoted people familiar with the matter. It states that the earnings of the Employees’ Provident Fund Organization are being worked out.
Though the EPFO is being worked out, according to reports, 8 per cent was possible given the high return on investment this year.
The EPFO’s Central Board of Trustees (CBT) is expected to meet later this month or early March to decide on the interest rate. After this, it will be recommended by the Finance Investment and Audit Committee based on the earnings of 2022-23.
The CBT is a tripartite body of the EPFO consisting of representatives of the government, employees and employers and the decision of the CBT is binding on the EPFO. It is headed by the Labor Minister.
For 2021-22, the government had approved a four-decade-low interest rate of 8.1 per cent on Employees’ Provident Fund deposits. The 8.1 per cent interest rate on EPF was the lowest since 1977-78, when it was 8 per cent.
The interest rate of 8.5 per cent on EPF deposits for 2020-21 was fixed by the Central Board of Trustees (CBT) in March 2021.
EPF is a mandatory savings scheme under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. It is managed under the aegis of Employees’ Provident Fund Organization (EPFO). It covers every establishment in which 20 or more persons are employed. The employee has to pay a fixed contribution towards the provident fund and an equal amount is paid by the employer on a monthly basis.
At the end of retirement or during service (under certain circumstances), the employee gets a lump sum amount along with the interest on the PF contribution that accrued. Government data shows that around 4.9 crore new subscribers joined the Employees’ Provident Fund (EPF) scheme during the period from September 2017 to November 2021.
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