It may be noted that EPF earned 8.55% interest in 2017-18 which was at a 5-year low. However, according to a report, if the rate is unchanged in 2018-19, it will still make it one of the most rewarding schemes.
New Delhi: The Employees’ Provident Fund Organisation (EPFO) might hike interest Employee Provident Fund interest rate this year. A Mint report cited three official saying that the chances of EPFO raising the interest rate are high. It may be noted that the interest rate is 8.55% per cent currently.
The financial daily cited official sources saying that the chances of a rate hike are high and even if the rate is not raised, it will be retained because of a steep decline in inflation. The report quoted the official saying, “2018 has been a relatively low-yielding year for debt investments, but the EPFO is unlikely to revise the interest rate downward for 2018-19 from what it paid last fiscal.” “It’s an important year and we are making the last round of calculations before announcing the EPF rate in late January”, he added further.
It may be noted that EPF earned 8.55% interest in 2017-18 which was at a 5-year low. However, according to the report, if the rate remains unchanged in 2018-19, it will still make EPF one of the most rewarding schemes when it comes to returns.
EPFO central board of trustees member Prabhakar Banasure told the newspaper that it is highly unlikely for the rates to be reduced. He even assured that efforts will be made to make sure the return is increased for the subscribers. He told Mint, “We are exploring whether we can offer an interest rate of more than 8.55% this financial year. Reduction of the rate is a complete no at this point in time, though the final calculation and accounts audits are still on.”
One of the official sources told the publication that though EPF interest rates are decided in the month of December, the delay this time is because the account audit has not yet finished. The rates are likely to be announced on February 1 ahead of elections.
Worth mentioning here is that EPFO subscribers may soon get an option in the new year to invest more of their savings in the equity market, besides a host of other social security benefits and digital tools to manage their funds.
