In a circular to the Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO), the finance ministry has directed it not to announce interest rates for the FY2023-24 without prior approval, The Indian Express reported on Sunday.

The development comes after the finance ministry in July this year, in a communique to the Labour Ministry, informed that EPFO, which administers the employees’ provident funds and pension schemes, is in a deficit of Rs 197.72 crore contrary to the EPFO’s projections of a surplus of Rs 449.34 crore for FY2021-22.

EPFO comes under the Ministry of Labour and Employment and manages the retirement funds for around six crore subscribers.

As a practice, CBT decides the interest rates in its annual meeting before sending its recommendation to the finance ministry for approval. However, as per the report, from FY2023-24, it will require prior approval from the ministry before announcing the rates to the public.

EPFO last announced the interest rates of 8.15 per cent for FY2022-23 on July 24, 2023, up from the previous 8.10 per cent. This was announced following its meeting on March 28, 2023. However, the rate was subject to final government approval, which came in July.

Historical Interest Rates: 

In FY 2020-21, the interest rate was 8.5 per cent; in FY2021-22, it was 8.1 per cent (the lowest since 1977-78 when the rate was 8.00 per cent); and in FY2022-23, it was 8.15 per cent.

Employee Provident Fund (EPF) Account: 

EPF account opening is mandatory for those earning less than Rs 15,000 per month in a company with over 20 employees. Under EPF, the employee and the employer contribute to the employee provident fund. The contribution is at least 12 per cent of the employee’s basic salary. The employee’s total contribution goes to the EPF account. In contrast, the employer’s contribution, which is equal to the employee’s contribution, is divided into two parts: EPF and Employees’ Pension Scheme (EPS), or 3.67 per cent for EPF and 8.33 per cent towards the EPS account.

EPFO currently offers higher interest rates than other saving schemes except for the senior citizen savings scheme (SCSS), which offers 8.2 per cent.

How To Check EPF Balance?

One can check the EPF balance by giving a missed call on 9966044425, sending an SMS “EPFOHO UAN” to 7738299899, visiting the EPF member portal, or through the Umang mobile app.