EPF new interest rate: The central board of trustees of the Employees’ Provident Fund Organisation is scheduled to meet on March 25-26 to determine the interest rates for provident fund deposits for 2022-23. According to a report in ET, the interest rate for the current fiscal could be around 8 per cent as the EPFO calculates its earnings.
The report said that the retirement body’s returns on investments have been robust this year as Covid-related withdrawals have decreased significantly.
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Sources quoted by ET in the report said that the EPFO could maintain the current interest rate of 8.1 per cent or reduce it to 8 per cent, depending on higher returns on equity investments.
“The Central government is unlikely to go for any major tweaking in the interest rates as it heads into key state assembly elections this year followed by general elections next year,” an official told ET.
The EPFO had set the interest rate of 8.1 per cent for 2021-22, which was the lowest in four decades and was significantly lower than the 8.5 per cent credited in the preceding year.
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2015-16 8.80%
2016-17 8.65%
2017-18 8.55%
2018-19 8.65%
2019-20 8.50%
2020-21 8.50%
2021-22 8.10%
In 2015-16, EPFO started investing in equities, wherein it invested 5 per cent of its incremental corpus in the first year, 10 per cent in the second year and 15 per cent in the subsequent years.
As per government data, EPFO has made a cumulative investment of Rs 1.7 lakh crore, of which over Rs 22,000 crore have been redeemed till March 31, 2022.
In general, EPFO invests its incremental corpus of Rs 1.5 lakh crore into equity in the form of exchange-traded funds (ETFs), both on the Nifty and the Sensex platforms.
