Even after almost 9 months after the interest on PF was fixed by the Finance Ministry, the interest money has not been received by the account holders. Last month, the Finance Ministry had also given the reason for this and said that the money would come soon, but till now the wait for the user is going on. We wanted to know from the expert whether there is any loss due to late arrival of interest money on PF.
New Delhi. The government has decided to pay 8.10 percent interest on PF account for the last financial year i.e. 2021-22. By the way, the decision on this was taken in March itself and since then about 7 crore PF account holders of the country are waiting for their interest. Despite the decision being taken at the beginning of the current financial year itself, the interest amount has not been credited to your account till the end of the year. On asking the experts on this, many facts came to the fore.
Investment advisor Balwant Jain says that it should be that like banks put interest money on your FD at the end of every financial year, similarly interest should also come in the PF account. But due to delay in all regulatory approvals and release of funds, crores of account holders have to wait for it. After the interest rates are fixed by the EPFO Trust, its recommendation is sent to the Finance Ministry and after getting approval from there, the fund raising exercise starts.
https://twitter.com/socialepfo/status/1586961392820965376?s=20&t=8qShU4w6198EoSoxt7lzwg
The government had indicated that interest would come soon
The Finance Ministry had said last month that there is a delay in getting PF interest money for the financial year 2022 because the work of software update is going on. New tax provisions have been added in the budget regarding interest on PF, due to which the software has to be updated. However, then the government had also said that soon the account holders would start getting interest money in the PF account. Currently waiting for the interest is going on.
The process of crediting interest is ongoing and it will get reflected into your account soon. Whenever the interest is credited, it will be paid in full. There will be no loss of interest.
— EPFO (@socialepfo) October 31, 2022
What did the government say on the loss
The Finance Ministry had also said that there will be no loss to the customers due to the delay in getting the interest money in the PF account. However, experts have a different opinion about this. They say that under the EPF Act 1952, account holders should get PF money at the end of every month, but if this does not happen, they may have to suffer losses in many ways.
There will be loss in settlement
Balwant Jain says that although the benefit of compounding is not given on the interest of PF and whenever the government pays its interest, it is calculated from April 1 every financial year. That is, there is no loss to the account holder directly, but if an account holder gets his settlement done before the interest comes, then he may have to bear the loss. In such a situation, the government will settle it only on the old interest, while the closure of the account after settlement may result in loss of future interest.
