The Employees’ Provident Fund Organisation (EPFO) may hand out more interest on provident fund deposits for the current fiscal, with an announcement likely at its trustees’ meet on Wednesday.
The retirement fund body has kept the interest rate on PF deposits unchanged at 8.75% in the past two financial years.
“Though the proposal for fixing rate of interest on PF deposits is not listed on the agenda, the EPFO’s apex decision-making body, the Central Board of Trustees (CBT), can announce the rate in its scheduled meeting,” a source familiar with the matter told PTI.
While a discussion on the restructuring of EPFO is the main agenda of the meeting, a decision on interest rate hike is also likely as the agency is ready with the income estimates for 2015-16, said the source.
However, the Finance Ministry wants EPFO to maintain the current interest rate of 8.75% for this fiscal.
At a recent meeting, top Finance Ministry officials “urged” the Labour Ministry to keep interest rate on PF deposits unchanged at 8.75% for the current fiscal year, given the government’s proposal to cut rate of return on small savings schemes and PPF, according to the source.
Nevertheless, a move to raise interest rate on employees’ savings will solely rest upon on the EPFO’s top decision-making body, headed by the labour minister.
In a bid to make the PF withdrawal process hassle-free, the EPFO recently allowed its subscribers to claim the saved amount without getting an approval from their employers.