The Employees’ Provident Fund Organisation (EPFO) is set to increase the provident fund (PF) interest rate, bringing good news to over 7 crore EPF subscribers in India. This update directly impacts salaried employees relying on EPF savings for financial security in retirement. If you have an EPF account, you may see a boost in your savings soon!
The interest rate for EPF deposits in FY 2024-25 is expected to be around 8.25%, slightly higher than the previous year’s 8.15%. This increase reflects EPFO’s efforts to provide better returns despite economic fluctuations. Let’s dive into the details of this update and what it means for you.
BIG NEWS for 7 Crore EPFO Members
| Topic | Details |
|---|---|
| Current EPF Interest Rate (FY 2024-25) | Expected to be 8.25% |
| Previous Interest Rate (FY 2023-24) | 8.15% |
| Total EPF Subscribers | Over 7 crore |
| EPFO Reserve Fund Plan | Interest Stabilization Fund proposed for FY 2026-27 |
| Official EPFO Website | EPFO India |
The EPF interest rate increase to 8.25% is great news for 7 crore EPFO members, offering better returns on their retirement savings. With the EPFO’s Interest Stabilization Fund plan, future interest rates are expected to remain steady, ensuring long-term financial security for employees.
If you’re an EPF member, keep track of your savings by checking your balance regularly using the UMANG app, EPFO website, SMS, or missed call service. Plan your withdrawals wisely to maximize your benefits!
What is EPF and How Does it Work?
Employees’ Provident Fund (EPF) is a government-backed retirement savings scheme designed for salaried employees. A portion of the employee’s salary (12% of the basic pay) is contributed to the EPF account, with an equal contribution from the employer.
Over time, these funds accumulate, earning annual interest, which is compounded. The EPF corpus can be withdrawn upon retirement, resignation, or under specific circumstances such as medical emergencies, home loans, or education expenses.
New PF Interest Rate for FY 2024-25: What You Need to Know
The EPFO is likely to increase the PF interest rate to 8.25%, ensuring better returns for members. This decision will be finalized in the Central Board of Trustees (CBT) meeting on February 28, 2025.
This increment benefits millions of employees, allowing their savings to grow at a faster rate compared to the previous fiscal year.
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How Much More Will You Earn?
If you have an EPF balance of ₹1,00,000, here’s how the new interest rate will impact your savings:
- At 8.15% (Previous Rate): You would earn ₹8,150 in interest per year.
- At 8.25% (New Rate): You will earn ₹8,250, a slight increase in annual interest.
While the increase may seem small for a single year, over 10-20 years, this can result in a significantly higher EPF corpus.
EPFO’s Interest Stabilization Fund: What is It?
To ensure consistent interest rates, the government is considering setting up an Interest Stabilization Fund (ISF) under the EPFO. The ISF aims to maintain stable returns, ensuring that economic fluctuations do not drastically impact EPF interest rates.
- Expected Implementation: FY 2026-27
- Purpose: To stabilize EPF interest rates and ensure long-term financial security for employees.
Benefits of EPF Interest Rate Hike
- Higher returns on long-term savings.
- More financial security post-retirement.
- Better retirement corpus planning for salaried employees.
- Encourages savings culture among employees.
- Assures stability in returns due to government support.
How to Check Your EPF Balance?
You can check your EPF balance using multiple methods:
1. UMANG App
- Download the UMANG app from Google Play Store or Apple App Store.
- Register with your mobile number linked to UAN.
- Log in and access your EPF passbook to check your balance.
2. EPFO Portal
- Visit the official EPFO website: epfindia.gov.in
- Log in with your Universal Account Number (UAN) and password.
- Click on ‘View Passbook’ to check your EPF balance and interest earned.
3. SMS Service
- Send an SMS in this format: “EPFOHO UAN” to 7738299899.
- You will receive an SMS with your EPF balance details.
4. Missed Call Service
- Give a missed call to 9966044425 from your registered mobile number.
- You will receive an SMS with your EPF balance and account details.
FAQs on EPF Interest Rate and Withdrawals
1. When will the new EPF interest rate be applicable?
The new interest rate of 8.25% is expected to be finalized on February 28, 2025 and will be applied for FY 2024-25.
2. Can I withdraw my EPF balance before retirement?
Yes, partial withdrawals are allowed for specific reasons such as medical treatment, education, home loan repayment, and marriage expenses.
3. How is EPF interest calculated?
EPF interest is compounded monthly but credited annually to your account.
4. What happens if I don’t withdraw my EPF after retirement?
Your EPF account will continue to earn interest for up to 3 years post-retirement. After that, it will become inactive, and no further interest will be credited.
5. How to claim EPF withdrawal online?
- Log in to the EPFO portal using UAN and password.
- Click on ‘Online Services’ > ‘Claim (Form-31, 19 & 10C)’.
- Enter details and submit your request.
