EPFO fixes 8.1 pc as interest rate on EPF deposits for 2021-22

Retirement fund body EPFO on Saturday decided to lower the interest on provident fund deposits for 2021-22 to an over four-decade low of 8.1 percent for its about five crore subscribers, from 8.5 percent provided in 2020-21, sources said.

This is the lowest since 1977-78 when the EPF interest rate stood at 8 percent.

”The Employees’ Provident Fund Organisation’s (EPFO’s) apex decision making body Central Board of Trustees has decided to provide 8.1 percent rate of interest on Employees Provident Fund (EPF) for 2021-22 in its meeting held on Saturday,” a source said.

The 8.5 percent interest rate on EPF deposits for 2020-21 was decided by the Central Board of Trustees (CBT) in March 2021.

It was ratified by the finance ministry in October 2021 and thereafter, EPFO issued directions to field offices to credit the interest income at 8.5 percent for 2020-21 into the subscribers’ account.

Now, after the CBT decision, the interest rate on EPF deposits for 2021-22 will be 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.

In March 2020, EPFO had lowered the interest rate on provident fund deposits to a seven-year low of 8.5 percent for 2019-20, from 8.65 percent 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 percent.

EPFO had provided an 8.65 percent interest rate to its subscribers in 2016-17 and 8.55 percent in 2017-18.

The rate of interest was slightly higher at 8.8 percent in 2015-16.

It had given an 8.75 percent rate of interest in 2013-14 as well as 2014-15, higher than 8.5 percent for 2012-13.

The rate of interest was 8.25 percent in 2011-12.