In a good news for working professionals, the Employees’ Provident Fund Organisation (EPFO) has announced a hike in the interest rate on the Employees’ Provident Fund (EPF). As per the decision, the EPFO has fixed an 8.25 percent interest rate on employees’ provident fund for the 2023-24 financial year. This is a three-year high from the retirement fund body.
The hike in EPF interest rate was taken at the 235th meeting of the Central Board of Trustees.
Taking to his X handle, Union Minister Bhupender Yadav wrote, “The 235th meeting of Central Board of Trustees, EPFO, today has recommended 8.25 per cent as the rate of interest on Employees’ Provident Fund deposits for 2023-24.”
Yadav claims that the action is a step in the direction of achieving Prime Minister Narendra Modi’s pledge to improve social security for Indian workers.
The Employees’ Provident Fund Organisation (EPFO) raised the interest rate on Employee Provident Funds (EPF) in March 2023, increasing it slightly from 8.10 percent in 2021–2022 to 8.15 percent for 2022–2023.
EPFO reduced the interest rate on its EPF for 2021–2022 in March 2022, from 8.5% in 2020–2021 to 8.1 percent—a four-decade low—for its more than six crore subscribers.
This was the lowest since the EPF interest rate was 8% in 1977–1978.
“The EPFO’s apex decision making body Central Board of Trustees (CBT) has decided to provide 8.25 per cent rate of interest on EPF for 2023-24 at its meeting on Saturday,” according to a source.
CBT determined in March 2021 that the interest rate on EPF deposits for 2020–21 would be 8.5%.
The interest rate on EPF deposits for 2023–2024 will be forwarded to the Ministry of Finance for approval following the CBT’s ruling.
The interest rate on EPF for 2023–2024 will be credited into the accounts of more than six crore EPFO subscribers following government ratification.
Only after it has been approved by the government through the ministry of finance does EPFO release the interest rate.
The interest rate on provident fund deposits was reduced by EPFO in March 2020 from 8.65 percent for 2018–19 to a seven-year low of 8.5 percent for 2019–20.
In 2016–17 and 2017–18, EPFO offered its subscribers an interest rate of 8.55% and 8.55%, respectively. In 2015–16, the interest rate increased marginally to 8.8%.
The retirement fund body offered an interest rate of 8.75 percent in 2013–14 and 2014–15, which was higher than 8.5 percent in 2012–13. In 2011–12, the interest rate was 8.25 percent.
