EPFO Cuts Interest Rate from 8.8 percent to 8.65 percent

EPFO Cuts Interest Rate from 8.8 percent to 8.65 percent Retirement fund body, Employees Provident Fund Organisation (EPFO) on December 19, 2016, reduced interest rate on employee provident fund (EPF) deposits to 8.65 per cent for 2016-17 from the current 8.8 per cent.EPFO’s apex decision making body, the Central Board of Trustees (CBT), headed by the Labour Minister took the

decision to reduce the interest rate by 0.15 per cent.  As per the EPFO, retaining 8.8 per cent rate of interest for the current fiscal would have left a deficit of Rs. 383 crore on projected income. EPFO has projected income of Rs. 39,084 crore for the current fiscal.

iv. However, the body could have retained the same rate of return for the current fiscal by utilising about Rs. 409 crore surplus it has, which was accrued after providing 8.8 per cent rate of interest for 2015—16.

v. A surplus of about Rs. 69.34 crore was stipulated if interest rate was lowered to 8.7 per cent.

About EPFO  :

♦ Employees Provident Fund Organisation (EPFO) is an organization tasked to assist the Central Board of Trustees.

♦ It assists the Central Board in administering a compulsory contributory Provident Fund Scheme, a Pension Scheme and an Insurance Scheme for the workforce engaged in the organized sector in India.

♦ Employee’s Provident Fund (EPF) is a retirement benefit scheme that’s available to all salaried employees. This fund is maintained and overseen by the Employees Provident Fund Organisation of India. It’s a savings platform that helps employees save a fraction of their salary every month that can be used in the event that you are rendered unable to work, or upon retirement.