The Employees' Provident Fund Organisation (EPFO) board has decided to maintain the interest rate on employees' provident fund deposits at 8.25% for the fiscal year 2024-25, according to sources cited by PTI. This decision, made during Friday's meeting, comes as a disappointment to EPFO subscribers who had been hoping for an increase amid rising inflation and widespread economic challenges.

 

The interest rate remains unchanged from the previous fiscal year 2023-24, when it had been marginally increased from 8.15% in 2022-23. "The EPFO's apex decision-making body, Central Board of Trustees (CBT), has decided to provide 8.25% rate of interest on EPF for 2024-25 at its meeting on Friday," a source informed PTI.

 

Following the CBT's decision, the proposed interest rate will be forwarded to the Ministry of Finance for final approval and concurrence. During the meeting, the Central Board of Trustees was also scheduled to address other significant matters affecting EPF members, including a review of the implementation of the Supreme Court's ruling on higher PF pension and proposals related to the Employees Deposit Linked Insurance Scheme (EDLI).

 

The current interest rate represents a significant decline from previous years. EPF deposit rates had fallen to a four-decade low of 8.1 % in 2021-22, following the 8.5% rate established for 2020-21. This downward trend is even more apparent when compared to the 8.8% rate offered in 2015-16, after which the EPFO began a gradual reduction in rates for its millions of subscribers.

 

The COVID-19 pandemic period saw a notable decrease in EPF deposit rates. In March 2020, the EPFO lowered the interest rate to 8.5% for 2019-20, down from 8.65% in 2018-19. Previous years had seen relatively higher rates, with 8.65% in 2016-17 and 8.55% in 2017-18.