The Employees’ Provident Fund Organisation (EPFO) board on Friday retained 8.25% interest rates on employees’ provident fund deposits for 2024-25 despite rising inflation.
The interest rate would be officially notified by the Government of India, after which EPFO would credit the rate of interest into the subscribers’ accounts.
Generally, the announcement of the interest rate for the EPF happens in the last month of the financial year for which the interest rate is applicable. However, the credit of EPF interest takes time.
EPF is a crucial retirement savings tool, as a higher interest rate enhances wealth accumulation and strengthens financial security post-retirement.
Further continuing with the reform agenda, the CBT, under the chairmanship of Dr Mansukh Mandaviya, took a series of decisions during the 237th meeting of the Central Board of Trustees.
Following the actuarial valuation of the Employees’ Deposit Linked Insurance (EDLI) scheme, the Board approved key modifications, including the introduction of a minimum benefit for death within one year of service, benefit for members who die while in service after a non-contributory period, and consideration of service continuity.
The modifications are estimated to result in higher benefits under EDLI in more than 20,000 cases of death in service every year, the Ministry of Labour & Employment said.
It is to be noted that compared to many other fixed-income instruments, the Employees’ Provident Fund (EPF) offers relatively high and stable returns, ensuring steady growth of savings. The interest earned on EPF deposits is tax-free (up to a specified limit), making it a highly attractive investment option for salaried individuals.
At the meeting, Status Note on Hon’ble Supreme Court Judgment on PoHW, Performance in Centralised Pension Payments System, Rationalising Damages and Reducing Litigation, and Approval of Annual Budget of EPFO were also discussed.