New Delhi: In what comes in as a significant jolt to the common man, the government is set to slashed the interest rate on the employees’ provident fund.


The employees’ provident fund interest rate for 2021-22 will be slashed from the existing 8.5 per cent to 8.1 per cent.


The EPFO fixes 8.1 pc as rate of interest on EPF deposits for 2021-22, PTI reported sources as saying.



The decision in this regard was taken during a meeting of the EPFO’s central board of trustees in Assam capital Guwahati.


This decision will affect around six crore subscribers of the EPFO. This is the lowest since 1977-78, when the EPF interest rate stood at 8 per cent.


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According to sources, the recommendation to reduce these interest rates came from the Union Finance Ministry, following which, it was approved by the EPFO.


"The Employees' Provident Fund Organisation's (EPFO's) apex decision making body Central Board of Trustees has decided to provide 8.1 per cent rate of interest on Employees Provident Fund (EPF) for 2021-22 in its meeting held on Saturday," PTI reported a source as saying.


The EPFO’s recommendation will soon be sent to the Finance Ministry. 


The EPFO will direct its field offices to credit the interest income calculated at the new rate of 8.1 per cent for 2021-22 in the subscribers' accounts after his decision is ratified by the Finance Ministry.


The EPFO had earlier in March 2020 lowered the interest rate on provident fund deposits to a seven-year low of 8.5 per cent for 2019-20 from 8.65 per cent for 2018-19.


The EPF interest rate provided for 2019-20 was the lowest since 2012-13 when it was brought down to 8.5 per cent.