EPF Interest Rate Lowered to 8.5% for the Financial Year 2020-2021. EPF has reduced 15 basis points on Provident Fund Deposits. EPFO Interest rate for the financial year 2019-2020.
On 6th March 2020, Retirement fund body EPFO has lowered interest rates on provident fund deposits by 15 basis points (bps) for this financial year 2020-2021. EPFO will pay interest at the rate of 8.5% for the current financial year. Earlier interest rate was 8.65% for FY 2018-19.
The move is going to impact 6 crore subscribers of the provident fund scheme. The decision was taken at a meeting of the EPFO’s top decision making body Central Board of Trustee (CBT). Labour Minister Santhosh Kumar Gangwar said that the new interest rate will result in surplus of of over 700 crore rupees for the current financial year. EPFO invests 85% of its annual earnings in debt market and 15% in equities through exchange traded funds (ETF’s).
EPF Interest rate 8.5% for the financial year 2019-20
The initial approval for 8.5% EPF rate was consented to by the EPFO in 2019-2020.
The Labour ministry to lower down the EPF rate in order to bring the rate at par with other schemes such as the Public Provident Fund (PPF).
The finance ministry has been reportedly nudging the labour Ministry for lowering the EPF interest rate. The EPFO has investments of more than 18 lakh crore.
It may be added that the Finance Ministry had in the previous fiscal i.e. 2015-16 tried to reduce the then EPF rate of 8.8% to 8.7%, as approved by the Central Board of Trustees (CBT). However, the decision was scrapped as it had not fallen through with any of the concerned stakeholders.
- EPFO India Websites List and EPF Online Facilities Providing by EPFO – Available Now