9.5% EPF interest rate may get OK'd

New Delhi: After months of haggling, the Finance Ministry is expected to concede to the EPFO’s proposal for an additional one per cent interest rate on retirement savings. This will mean that the 4.72 crore subscribers of the Employees’ Provident Fund Organisation will enjoy an interest rate of 9.5 per cent on their Provident Fund deposits in 2010-11.

“The Ministry is expected to notify the 9.5 per cent interest rate soon,” said an official.

This is expected to come with certain riders — the EPFO will have to update members’ accounts within six months to get a clearer picture of the actual money in its interest suspense account.

Last September, the EPFO had announced the additional interest rate after discovering a Rs 1,731.57-crore surplus in its interest suspense account. But the Finance Ministry and the Comptroller and Auditor General questioned this; the CAG blamed the “non-updation” of members’ accounts for the accumulation of the surplus in EPFO’s suspense account.

Source: Financial Express