The retirement fund body, Employees Provident Fund Organisation (EPFO) has voted on Saturday to pay an interest rate 8.1% for 2021-22.
The rate of interest has been slashed as low as 8.1% from the existing 8.5%. This is the lowest rate of interest ever since 1977-78, which was 8 per cent, as per labour ministry sources said.
There are around five crore subscribers of EPFO. In March last year, the EPFO Board finalised a recommendation of 8.5 percent interest rate for the prior year 2020-21. The CBT is led by the Union Labour Minister and representatives from both the business and employee sides determine the interest rate proposal. And the final approval is taken by Finance Ministry for any sort of changes.
This decision was taken during the meeting of the EPFO’s central board of trustees, which was held in Guwahati. The last interest rate was 8.5 per cent in 2020-21.
Once the finance ministry takes the final decision, the EPFO will direct its field offices to credit the interest income calculated at the new rate of 8.1 per cent for 2021-22 into the subscribers’ accounts.
The details of March 2020, EPFO lowered the interest rate on provident fund deposits to a seven-year low of 8.5 per cent for 2019-20, from 8.65 per cent provided for 2018-19.
The EPF interest rate provided for 2019-20 was the lowest since 2012-13, when it was brought down to 8.5 per cent
