New Delhi: Centre today approved an 8.1 per cent rate of interest on employees’ provident fund deposits for 2021-22- the lowest in four decades. The rate of interest came is applicable for around five crore subscribers of retirement fund body EPFO.
EPFO, earlier in March had decided to lower interest on PF deposits for 2021-22 to 8.1 per cent from 8.5 per cent in 2020-21.
According to the EPFO office order issued on Friday, the Ministry of Labour and Employment has conveyed the approval of the central government to credit an 8.1 per cent rate of interest for 2021-22 to each member of the EPF scheme. The labour ministry had sent the proposal to the Ministry of Finance for its concurrence.
The 8.1 per cent EPF rate of interest is the lowest since 1922-78, which stood at 8.5 per cent.
The Employees’ Provident Fund came into existence with the promulgation of the Employees’ Provident Funds Ordinance on the 15th November 1951. It was replaced by the Employees’ Provident Funds Act, 1952. The Employees’ Provident Funds Bill was introduced in the Parliament as Bill Number 15 of the year 1952 as a Bill to provide for the institution of provident funds for employees in factories and other establishments. The Act is now referred to as the Employees’ Provident Funds & Miscellaneous Provisions Act, 1952 which extends to the whole of India. The Act and Schemes framed there are administered by a tri-partite Board known as the Central Board of Trustees, Employees’ Provident Fund, consisting of representatives of Government (Both Central and State), Employers, and Employees.