New Delhi: Recently, a report claimed that this year there will be a single digit increase in the salary of the employees. Now, there may be a setback for the interest received on the amount deposited in the PF account. According to a Times of India report, the EPFO is considering reducing the interest rate on PF account deposits to 8.5% for the financial year 2020. Currently, 8.65% interest is being paid by EPFO on the PF account.
According to sources, a proposal to this effect can be presented in the Central Board of Trustees meeting on 5 March. In the financial year 2019, employees are getting 8.65 percent interest on the amount deposited in the PF account. It is now preparing to cut 15 basis points. In the last one year, interest on long term fixed deposits and bonds etc. has been reduced by 50 to 80 basis points. Explain that a basis point means 0.1 percent.
A decision on interest rates will be taken by the Finance Investment and Audit Committee before the EPFO Trustees’ meeting. After this the proposal will be presented in the meeting. However, a government source said that the government does not want such a decision as it would send a bad message among the employees.
The government, which is already under criticism due to lack of adequate employment opportunities, now does not want to be surrounded by issues like PF interest rate. Due to the cut in the interest rate on the amount deposited in the PF, the government may have to face opposition of crores of employees.
