The Employees’ Provident Fund Organisation (EPFO) is likely to retain the interest rate on provident fund deposits at 8.25% for the financial year 2024-25, according to a report by a news agency. The final decision will be taken at the Central Board of Trustees (CBT) meeting scheduled for February 28, 2025.
If the board confirms this rate, it will be the same as the previous year’s interest rate, benefiting over 65 million subscribers nationwide.
Despite witnessing a strong financial year with increased returns and a growing subscriber base, Employees’ Provident Fund Organisation (EPFO) also experienced higher claim settlements, leading to a significant outflow of funds.
As per official data cited by a news agency:
Over 5 crore claims amounting to Rs 2.05 lakh crore have been processed so far in 2024-25.
This marks an increase from 4.45 crore claims worth Rs 1.82 lakh crore settled in 2023-24.
The rising number of claims indicates that more employees are withdrawing funds, possibly due to financial uncertainties, job transitions, or other economic factors.
Every year, EPFO proposes an interest rate on PF deposits, which is then reviewed by the Central Board of Trustees (CBT). However, the final rate can only be implemented after the Finance Ministry’s approval. Once approved, the interest is credited into the accounts of EPFO subscribers, typically in the second half of the following financial year.
In 2023-24, EPFO offered an 8.25% interest rate, the highest recorded so far, on a total principal amount of approximately Rs 13 lakh crore.
EPFO operates under a tri-partite Board structure—the Central Board of Trustees, Employees’ Provident Fund—which consists of representatives from:
The Central and State Governments
Employers
Employees
EPFO is responsible for administering:
A contributory provident fund
A pension scheme
An insurance scheme
The organization plays a crucial role in securing the financial future of millions of employees in the organized sector and is considered one of the largest provident fund institutions worldwide.
As the February 28 meeting approaches, key points to watch include:
Confirmation of the 8.25% interest rate – Will the board approve the same rate as last year?
Potential adjustments based on financial trends – Could there be any revisions due to economic factors?
Impact on subscribers – What does this mean for salaried employees relying on EPF for long-term savings?
Government and employer perspectives – How will stakeholders respond to the interest rate decision?
The Employees’ Provident Fund Organisation (EPFO) plays a crucial role in ensuring the financial security of millions of salaried employees across India. With the expected 8.25% interest rate for 2024-25, the organization continues to offer stable returns despite market fluctuations and increased claim settlements. While EPFO has witnessed a growth in investments and subscriber base, the rising outflow due to withdrawals remains a challenge.
The final decision, pending approval from the Central Board of Trustees (CBT) and the Finance Ministry, will directly impact over 65 million EPF subscribers.
The proposed rate ensures that employees' hard-earned savings continue to generate competitive returns, maintaining EPFO's status as one of the largest social security organizations globally. As the financial year progresses, all eyes will be on the upcoming CBT meeting on February 28, where the final interest rate will be determined, shaping the future financial landscape for millions of employees.