EPFO retains 8.25% interest rate on PF deposits for 2025
The Employees’ Provident Fund Organisation (EPFO) on Monday approved an interest rate of 8.25 per cent on Employees’ Provident Fund (EPF) deposits for 2025-26, retaining the same rate for the second consecutive year, according to an official statement.
The decision was taken at the 239th meeting of the Central Board of Trustees (CBT) held in New Delhi and chaired by Union Labour and Employment Minister Mansukh Mandaviya. The meeting was attended by Minister of State Shobha Karandlaje, Labour and Employment Secretary Vandana Gurnani, and EPFO chief Ramesh Krishnamurthi.
Following the CBT’s approval, the proposed interest rate will be forwarded to the Ministry of Finance for concurrence. Once formally ratified, the new rate will be credited to the accounts of over seven crore EPFO subscribers.
Interest on EPF deposits is calculated on a monthly running balance but is credited to subscribers’ accounts at the end of the financial year. However, accounts that remain inactive for 36 months are classified as dormant and do not earn further interest.
According to the statement, despite global economic uncertainties, the EPFO has maintained strong financial discipline, ensuring stable and competitive returns without straining its interest account.
Continuing its reform initiatives, the Board also approved a one-time Amnesty Scheme to address compliance issues relating to income tax–recognised trusts that are yet to be covered under or granted exemption under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (EPF & MP Act), taking into account the provisions of the Finance Act, 2026.
The proposed scheme aims to bring such establishments and trusts into compliance within a defined six-month window. It seeks primarily to protect workers’ interests by waiving damages, interest and penalties for entities that have already provided benefits equal to or better than the statutory scheme. The scheme also allows retrospective relaxation or exemption, subject to specified conditions, and ensures that all eligible employees receive statutory benefits.
The measure is expected to resolve over 100 active litigation cases, along with several others, thereby benefiting thousands of trust members. It will apply to exempted establishments that have complied with the provisions of the EPF & MP Act.
The Board also approved a new, simplified Standard Operating Procedure (SOP) on EPF exemptions. The revised SOP consolidates four existing SOPs and the Exemption Manual into a single comprehensive framework aimed at reducing the compliance burden.
The new framework introduces an end-to-end digital process for the surrender of exemptions and transfer of past accumulations, enhancing transparency and efficiency in auditing exempted establishments. The unified system is expected to promote ease of doing business through technology-driven governance.
In addition, the CBT approved the notification of new social security schemes to align with the Code on Social Security, 2020, ensuring a seamless transition from the existing framework.
The newly approved Employees’ Provident Fund Scheme, 2026; Employees’ Pension Scheme, 2026; and Employees’ Deposit Linked Insurance (EDLI) Scheme, 2026 will replace the current schemes, providing a legally robust foundation for administering provident fund, pension and insurance benefits in the coming years.
(IANS)
