EPF Interest Rate: There is a bad news for crores of people working in the private sector. The interest on PF may reduce in the coming days. This may weaken the only basis of social security for those doing private jobs.
EPFO suffers loss instead of surplus
This information has been given in a news of Indian Express quoting RTI. According to the news, during the financial year 2021-22, EPFO had incurred a loss even after estimating a surplus. It was believed that EPFO would have a surplus of Rs 449.34 crore, whereas it faced a deficit of Rs 197.72 crore. After that, it was decided to reconsider the interest rates being given on PF.
This is the stance of the Finance Ministry on interest.
At present the interest being received on PF is already low. EPFO has fixed the interest rate on PF at 8.15 percent for the financial year 2022-23. The Finance Ministry believes that keeping in mind the losses incurred by EPF, it is necessary to reconsider the interest rate of PF. There is a need to reduce the high interest rates of PF and bring them at par with market rates.
Only this scheme has more interest than PF
At present, if we compare the interest received on PF with the market, it is really higher. Among small savings schemes, there is only one Senior Citizen Savings Scheme, which is currently getting more interest than PF. The interest rate of this scheme is currently 8.20 percent. From Sukanya Samriddhi Yojana to National Savings Certificate (NSC), interest rates on everything are lower than PF. For this reason, the Finance Ministry has been advocating for a long time to reduce PF interest to below 8 percent.
In this way the interest on PF reduced
On the other hand, if we look at the interest already being received on PF, the rates are currently on the lower side. Interest on PF has been continuously reduced. In the financial year 2015-16, the interest rate on PF was reduced from 8.80 percent to 8.70 percent. After protest by trade unions, it was again reduced to 8.80 percent. After that the interest rates on PF kept decreasing and came to a low level of 8.10 percent in 2021-22. In 2022-23, it was increased marginally to 8.15 percent.
EPFO has so many crores of subscribers
PF is the biggest basis of social security for crores of people working in the private sector. This helps in creating a fund for life after retirement. Crores of people have been benefiting from getting good interest on PF. PF money is managed by EPFO i.e. Employees Provident Fund Organization. At present the number of subscribers of EPFO is more than 6 crores.
