EPFO Board to Meet on February 28 Likely to Review Interest Rate for Provident Fund Deposits

The EPFO Board is set to meet on February 28 likely to discuss and finalise the interest rate for provident fund deposits for the 2024-25 financial year. The rate is likely to remain close to 8.25%, despite increased claims and returns, as per news reports.

EPFO Set to Decide 2024-25 Interest Rate

The Employees’ Provident Fund Organisation (EPFO) is likely to maintain the interest rate on provident fund deposits for 2024-25 at above 8%, close to the 8.25% declared for the preceding year when its central board of trustees (CBT) meets on February 28, said people familiar with the matter, as per ET report.

The investment committee and the accounts committee of the EPFO, the erstwhile Finance, Investment and Audit Committee, will meet next week to consider the income and expenditure of EPFO in the current financial year and arrive at a rate of interest that could leave the retirement fund body with a substantial surplus to meet any exigencies, they said.

EPFO Sees Higher Claims and Returns

The current financial year has seen higher returns on EPFO investments and an increase in subscriber base but at the same time, there has been a substantial increase in claim settlements this year, said an official, who did not wish to be identified.

Official data shows that the EPFO has processed more than 50.8 million claims amounting to ₹2.05 lakh crore in 2024-25 compared to 44.5 million claims worth ₹1.82 lakh crore settled in 2023-24.

“The committees concerned are working out the details and are expected to propose such a rate that will be on a par with previous years,” the official said.

EPFO’s Record Income and Interest Rates

The EPFO has more than 65 million subscribers. It had given 8.25% interest for 2023-24 on income of ₹1,07,000 crore, its highest so far, on a total principal amount of about ₹13 lakh crore.

The rate of interest was higher than 8.15% for 2022-23 on income of ₹91,151.66 crore on a principal of ₹11.02 lakh crore.

The interest rate on PF deposits for any given year, proposed by the EPFO, must be approved by the Finance Ministry before it is finalised and credited to the accounts of subscribers.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.