In a move that will impact 17 crore subscriber accounts, the interest rate on Employee Provident Fund (EPF) is down by 0.15 per cent, from 8.8 per cent last fiscal to 8.65 per cent now.
The Central Board of Trustees (CBT), the apex decision making body of the EPF Organisation, took the decision at a meeting in Bengaluru on Monday, attended by Union Labour Minister Bandaru Dattatreya. This will now have to be notified by the Finance Ministry.
In a release, the EPFO said that the interest rate had been decided based on the estimated income from the investment holdings. “Because of the dip in surplus last year, the interest rate had to be reduced by 0.15 per cent,” said Mr. Dattatreya. “The decision was taken considering the overall economic scenario of interest rates that are coming down.” He said this was highest possible interest rate that could be paid under the circumstances.
Trade unions had been demanding that the interest rates be retained at 8.8 per cent.
