Provident fund deposits to get 8.5% interest in 20-21

Retirement fund body EPFO on Thursday decided to retain 8.5 per cent rate of interest on provident fund deposits for the current financial year.

Illustration: Uttam Ghosh/Rediff.com.

EPFO has more than five crore active subscribers.

The Employees' Provident Fund Organisation's (EPFO) apex decision-making body, Central Board of Trustees, decided to fix 8.5 per cent rate of interest for 2020-21 at its meeting in Srinagar on Thursday, sources said.

There was speculation that the EPFO would lower interest on provident fund deposits for this fiscal (2020-21) from 8.5 per cent given in 2019-20 in view of more withdrawals and lesser contribution by members amid the coronavirus pandemic.

In March last year, the EPFO had lowered interest rate on provident fund deposits to a seven-year low of 8.5 per cent for 2019-20, from 8.65 per cent in 2018-19.

The EPF (Employees Provident Fund) interest rate provided for 2019-20 was the lowest since 2012-13, when it was 8.5 per cent.

The EPFO had provided 8.65 per cent interest rate to its subscribers in 2016-17 and 8.55 per cent in 2017-18. The rate of interest was slightly higher at 8.8 per cent in 2015-16.

It had given 8.75 per cent rate of interest in 2013-14 as well as 2014-15, higher than 8.5 per cent for 2012-13. The EPFO had provided 8.25 per cent rate of interest on provident fund in 2011-12.