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1.25% Reduced Interest Rate of Employee's Provident Fund (EPF).

There is a big loss of Interest to Public & Private Sector Employees on there Regular and Deposit Fund. EPF Interest rate was increase by 1% in the Fin. Year 2010-11 and the amount of 1% deposited as a suspense amount. During this year only for 4 months .06% interest rate is increased but at the end of year EPFO reduced the Interest Rate on Deposit and Regular Deposit Fund of Employees by 1.25%. This is big loss of Public and Private Sector Employees. Apart from this the EPFO allows to deposit invest more money by the employee except terms and conditions in securities, it is not viable for them to pay higher Interest rate.

Further Interest rate for Financial year 2011-12 has been announced when few days are left in the in the financial year and on the one day before the Union Budget 2012. On the other side RBI has not changed the interest rate ?

The reduction in interest rate on deposits in Employees' Provident Fund from 9.5 per cent to 8.25 per cent for 2011-12 affecting over 4.7 crore subscribers.

This cut was proposed by the finance ministry and a notification was issued by the labour ministry, official sources said.

The Employees' Provident Fund Organization (EPFO) had provided 9.5 per cent interest rate to its subscribers for 2010-11 after it found Rs 1,731 crore surplus in its books of account.

The labour ministry had recommended 8.6 per cent rate of interest for this fiscal on provident fund deposits to EPFO subscribers.

On 14.03.2012 FA & CAO issued a circular to all Regional provident commissioners (Download Now)

Interest rate of EPF (Click Here)

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