Modi govt's bumper Diwali gift to PF subscribers! Finance Ministry approves 8.5% PF interest rate for FY21

New Delhi: Bringing cheers to 6 crore beneficiaries of Employees’ Provident Fund (EPFO) ahead of Diwali, the Finance Ministry on Friday approved 8.5 percent interest rate on provident fund (PF) deposits for 2020-21. 

EPFO will soon start crediting it into the beneficiary account. It may be recalled that in March 2021, the EPFO apex decision-making body Central Board of Trustees decided to fix 8.5 per cent rate of interest for 2020-21 at its meeting in Srinagar.

"The Central Board of Trustees (CBT) recommended 8.50 per cent annual rate of interest to be credited on EPF accumulations in members'' accounts for the financial year 2020-21," a labour ministry statement said.

As per the practice, the CBT decision on interest rate is being to the finance ministry for concurrence. Now, after getting the finance ministry''s nod, the 8.5 per cent rate of interest for this fiscal would be credited into the EPFO subscribers.

The interest rate would be officially notified in the government gazette following which the EPFO would credit the rate of interest into the subscribers’ accounts.

The assured fixed return approach of the EPFO, announced by the CBT every year, along with the tax exemptions makes it an attractive choice for investors, providing them with strong social security in the form of provident fund, pension and insurance schemes.