EPF Interest Rate 2021-22: PF Account holders to Get Lowest Interest in 10 Years; Know More
EPF interest rate 2021-22: The Employees’ Provident Fund Organisation (EPFO) on Saturday decided to pay 8.1 per cent rate of interest on provident fund deposits for the current financial year 2021-22, sources told CNBC-TV18. The decision was taken in EPFO‘s central board of trustees meeting today.
Earlier, the retirement body kept the interest rate unchanged on the provident fund deposits at 8.5 per cent for the financial year 2020-21, despite the substantial withdrawals in the wake of Covid’s impact on people’s financial resources. The retirement fund body saw high withdrawals and lower contributions in the aftermath of the Covid-19 pandemic. Until December 31, the EPFO had settled 56.79 lakh claims worth Rs 14,310.21 crore provided under the advance facility.
Prior to that, the EPFO had reduced the interest rate on provident fund deposits to a seven-year low of 8.5 per cent for 2019-20. The interest rate was 8.65 per cent in 2018-19. The EPFO had provided 8.55 per cent interest rate to its subscribers for 2017-18. The interest rate was 8.65 per cent in 2016-17.
The Central Board of Trustee, which is a key decision-making body for EPFO, takes a call on the interest rates, that has to be provided on the provident fund deposits, every year. Once CBT decides an interest rate on EPF deposits for a fiscal year, it is sent to the Ministry of Finance for concurrence. EPFO provides the rate of interest only after it is ratified by the government through the finance ministry.
EPF interest rate 2021-22: What is EPF?
EPF is a mandatory savings scheme under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. It is managed under the aegis of Employees’ Provident Fund Organisation (EPFO). It covers every establishment in which 20 or more persons are employed. The employee has to pay a certain contribution towards the provident fund and the same amount is paid by the employer on a monthly basis. At the end of retirement or during the service (under some circumstances), the employee gets the lump sum amount including the interest on PF contributed which gets accrued
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