EPFO: Govt likely to notify 5-year low 8.55% interest on provident fund for FY18 this week

The Labour Ministry is likely to notify this week the 5-year low 8.55 percent interest on PF for 2017-18, paving the way for retirement fund body EPFO to credit returns into the accounts of around 5 crore subscribers. The Finance Ministry has ratified 8.55 per cent rate of interest on EPF for last fiscal. “The labour ministry has sought Election Commission’s approval to notify rate of interest for crediting the same into members’ accounts by the EPFO in view of model code of conduct for Karnataka elections,” a source said. [caption id=“attachment_4406375” align=“alignleft” width=“380”] Representational image. Reuters[/caption] “The nod is expected anytime this week to provide 8.55 percent rate of interest to the EPFO subscribers,” the source said. The recommendation on the rate of interest by the Central Board of Trustees, the apex decision making body of Employees’ Provident Fund Organisation(EPFO), is sent to the finance ministry for its concurrence. Once ratified, the Labour Ministry notifies the rate of interest and the EPFO credits the return for the particular year into its members account. The CBT, headed by the labour minister, had decided to fix 8.55 percent rate of interest for last fiscal in its meeting held on 21 February, 2018. It could not be implemented for the want of Finance Ministry’s concurrence and was further delayed due to the model code of conduct for Karnataka elections on 12 May. EPFO had provided 8.65 percent interest for 2016-17. The members got 8.8 percent in 2015-16 and 8.75 percent each in 2013-14 and 2014-15. In 2012-13, EPFO had provided 8.5 percent rate of interest on EPF. Thus, at 8.55 percent for 2017-18, it is a five year low.