NEW DELHI: The finance ministry on Friday approved an 8.5% rate of interest on employees’ provident fund for 2020-21.
A source from the labour ministry confirmed TNIE that the rate of interest on employees’ provident fund (EPF) for the 2020-21 fiscal has been ratified by the finance ministry and would be credited into the accounts of EPFO subscribers.
The move, a few days ahead of Diwali, comes as good news for over 5 crore subscribers of the Employees Provident Fund Organisation (EPFO).
After the Covid-19 outbreak, the EPFO in March last year had lowered the interest rate on provident fund deposits to 8.5% for 2019-20, from 8.65% in 2018-19. The EPF interest rate provided for 2019-20 was the lowest since 2012-13.
The 8.5% of interest on EPF for the last financial year was decided by the EPFO’s apex decision making body Central Board of Trustees (CBT) headed by the labour minister.
The labour ministry has to notify the interest rate for the year before EPFO starts crediting it into the beneficiary accounts.
EPFO subscribers were provided 8.8% interest rate in 2015-16, 8.65% in 2016-17 and 8.55% in 2017-18.
The retirement fund body added around 14.81 lakh net subscribers in August, a 12.61% increase in the net subscribers addition, as compared to the previous month of July 2021.
Of the total 14.81 lakh net subscribers, around 9.19 lakh members have come under the ambit for the first time, according to the provisional payroll data released by the labour ministry.