It’s a good news that retirement fund body EPFO decided to increase the rate of interest on Provident Fund deposits to 8.75 percent for financial year 2013-14, which will benefit about 5 crore subscribers. It had provided 8.50 percent interest in the financial year 2012-13, which was higher than 8.25 percent interest announced in financial year 2011-12.
The Employees’ Provident Fund Organisation’s apex decision making body – Central Board of Trustees (CBT) – met to decide on the PF interest rate for this fiscal. Now you are going to get more on PFs after organisation fixes rate at 8.75 percent.
According to sources, the body had surplus funds, which enabled the interest rate to be increased from 8.5 percent in the previous financial year (2012-13).
The EPFO’s recommendation will be vetted by the Finance Ministry. Once the ministry approves the decision, the interest would be credited to the accounts of subscribers. According to sources, the decision to enhance the rate was taken in view of the forthcoming Lok Sabha polls.
The EPFO is estimated to have an income of Rs 20,796.96 crore in the current financial year. Payment of interest at the rate of 8.5 percent to subscribers would have required Rs 20,740 crore and left a surplus of Rs 56.96 crore, according to earlier projections.
You might want to read: EPF historical Interest Rates since year 1952