New Delhi: The Employees Provident Fund Organisation (EPFO) announced Thursday that the interest rate on provident fund deposits will remain unchanged at 8.5 per cent for the financial year 2021-21. This decision was taken by the EPFO’s central board of trustees at a meeting in Srinagar. During the meeting it was decided to maintain the 8.5 per cent interest rate after examining earnings and financial positions. Two of the board members have disclosed this information to ‘Mint’.
The state-run retirement fund manager’s decision will certainly make the middle-class in India happy. With the economy hit hard due to the COVID-19 pandemic, it was expected that there will some fall in the rate of interest for provident funds. However, that has not happened bringing relief to millions.
The announcement also comes after several reports had hinted that the central body, which has over 50 million active subscribers, would lower the interest following more withdrawals and relatively and lesser contribution by members due to the coronavirus pandemic.
The interest provided by EPFO on provident funds was 8.55% in 2017-18, 8.65% in 2016-17 and 8.8% for the fiscal year 2015-16. The retirement fund manager gave 8.75% rate of interest in 2013-14 as well as 2014-15, higher than 8.5% for 2012-13. It had provided an 8.25% cent rate of interest on provident fund in 2011-12.
According to the latest report released by the National Statistical Office (NSO), net new enrolments with retirement fund body EPFO stood over 1.25 million in December, up from 870,000 in November 2020.