The Employees’ Provident Fund Organisation (EPFO) has kicked off creditingProvident Fund (PF) claims at 8.25% interest rate, which was declared for the financial year 2023-24. In a series of announcements on social media, EPFO reassured members that they will not face any losses due to delayed credit of interest rates.
As per EPFO, over 23 lakh PF withdrawal requests have been approved so far, disbursing around Rs. 9,260 crores to beneficiaries. The retirement fund body highlighted that if the interest rate announced post-financial year ends up being higher than previous year, members will receive the difference amount to ensure no losses.
In February 2024, EPFO’s Central Trustee Board had recommended 8.25% interest on PF deposits for 2023-24, which was later ratified by the Finance Ministry in May. This is the highest rate offered by EPFO in last 3 years, providing relief to its over 6.8 crore active subscribers. The interest payout is calculated based on investment returns from debt and equity instruments.
While debt returns can be estimated in advance, equity yields are only finalized after the financial year when securities are redeemed. Hence, there may be a delay between interest declaration and credit. However, EPFO assures timely payout of any differential amount to members if the announced rate surpasses earlier years.
Going forward, EPFOstated the accounts of existing employees under the scheme will also see interest credits for 2023-24 soon. This move aims to benefit India’s large workforce who depend on social security through the mandatory PF deposits.
