EPFO cuts interest rate on PF deposits for 2016-17 to 8.65%

New Delhi: Retirement fund body EPFO on Monday fixed 8.65 percent rate of interest on EPF deposits for the current fiscal for its over four crore subscribers.

The Finance Ministry had earlier this year decided to lower interest rates on EPF for 2015-16 to 8.7 percent from the 8.8 percent approved by the CBT headed by the Labour Minister.

The government had to roll back the decision and provide 8.8 percent rate of interest on EPF deposits for 2015-16 following protests by trade unions. Retirement fund body had maintained interest rate at 8.75 percent for 2013-14 and 2014-15 while it was 8.5 percent in 2012-13.

In September, the government had reduced the interest rates on small savings schemes marginally by 0.1 percent for the October-December quarter of 2016-17, which resulted in lower returns on PPF, Kisan Vikas Patra, Sukanya Samriddhi Account, among others.

EPFO has also taken decision to reduce administrative charges from 0.85 percent at present to 0.65 percent on total wage on which contributions are payable.