EPFO proposes interest rate cut: Finance Ministry to ratify decision soon

The Employees' Provident Fund Organisation (EPFO) has reduced the interest rate to about 8.1 percent for the financial year 2022. This is down by about 40 basis points (bps) over FY21 where it was 8.5 percent.

It is the lowest in over four decades. From here, EPFO, as a body, has approved this interest rate of 8.1 percent, it will go to the finance ministry for a final ratification. Once that happens, then the process of crediting it to accounts of EPF subscriber would start.

This affects about 6 crore salaried workers, the interest rate which one receives at the end of the year towards the retirement fund. However, one needs to consider the fact that the returns given by the EPF are still much more superior as compared to a lot of other governments small saving schemes.