Retirement fund body hikes EPF interest rate: Know more
What's the story
The Employees' Provident Fund Organisation (EPFO) has officially hiked the interest rate on Employees' Provident Fund (EPF) deposits to 8.25%, a three-year high, for 2023-24.
It is learned that the call over the EPF hike was made on Saturday during a meeting of the EPFO's apex decision-making body, the Central Board of Trustees (CBT).
Previous rates
EPF last hiked in March last year
Saturday's move comes after the EPFO marginally hiked the interest rate on EPF in March last year to 8.15% for the 2022-23 fiscal year, up from 8.10% in 2021-22.
However, the provident fund body had lowered the interest rate on EPF in March 2022 to a more than four-decade low of 8.1% for 2021-22, down from 2020-21's 8.5%.
Official go-ahead
Step toward fulfilling Modi's guarantee of strengthening social security: Yadav
EPFO's central board of trustees, headed by Union Labor and Employment Minister Bhupender Yadav, gave the nod to the proposed interest rate during the body's 235th board meeting.
"The move is a step towards fulfilling Prime Minister Narendra Modi's guarantee of strengthening social security for India's workforce," The Hindu quoted him as saying.
What's next?
Interest rate on EPF deposits to be forwarded to ministry
The interest rate on EPF deposits for 2023-24 will now be sent to the Ministry of Finance for concurrence.
Following the government's approval, the interest rate on EPF for 2023-24 will be credited to the accounts of nearly six crore EPFO subscribers.
The EPFO provides the interest rate only once it has been approved by the government through the finance ministry.
EPF details
All you need to know about EPF
The EPF is a mandated contribution for salaried employees. An employer must also make a matching contribution to the EPF account.
An employee contributes 12% of his earnings to his/her monthly EPF account, and the full contribution is placed into the EPF account. In the employer's case, 3.67% gets deposited into the EPF account, while 8.33% goes to the Employees Pension Scheme (EPS).