EPFO cuts interest rate to 8.1%, lowest in 40 years

NEW DELHI: The government on Friday approved lowering the interest rate on employees’ provident fund (EPF) to 40 year low of 8.1 per cent.
With today’s reduction, the EPF interest rate is lowest since 1977-78, when it stood at 8 per cent.
In March this year, the Employee Provident Fund Organisation (EPFO) had proposed to lower the interest rate on retirement savings for its 6.4 crore subscribers from 8.5 per cent to 8.1 per cent.
The payout, which have now been confirmed by the finance ministry, is in line with the agency’s earnings and will leave it with a surplus of Rs 450 crore during the financial year.
Compared to earnings of 8.5 per cent on the corpus last year, this year’s earnings EPFO has estimated an income of Rs 76,768 crore, which translates into a return of 7.9 per cent, labour minister Bhupendra Yadav had said after a meeting of the EPFO in Guwahati in March.