Govt keeps EPF rate at 8.25% for FY25: Here's what it means for you

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The government has approved an interest rate of 8.25 per cent on Employees’ Provident Fund (EPF) deposits for the financial year 2024-25 (FY25). The ratification by the Ministry of Finance means the Employees’ Provident Fund Organisation (EPFO) will soon begin crediting interest into the accounts of over seven crore EPF subscribers.

   

PF Interest rate remains unchanged from last year

   

According to PTI, the EPFO had proposed to retain the same interest rate of 8.25 per cent for FY25, which was first approved in February 2024 during the 237th meeting of its Central Board of Trustees. The meeting was chaired by Union Labour Minister Mansukh Mandaviya.

   

How does this impact you?

   

For EPF members, especially those planning for retirement, this announcement comes as a relief. Here’s why the interest rate matters:

   

Steady returns: At 8.25 per cent, EPF remains one of the most attractive debt-based investment instruments.

 

Tax benefits: Contributions to EPF qualify for deductions under Section 80C of the Income Tax Act.  Calculate Income Tax: Income Tax Calculator Tool

 

Long-term security: Since interest compounds annually, maintaining a higher rate boosts long-term retirement corpus.

   

EPF interest rate trends over the years

   

The current rate reflects stability after a few fluctuations in recent years:

   

FY24: 8.25 per cent

 

FY23: 8.15 per cent

 

FY22: 8.10 per cent (lowest in over four decades)

 

FY21: 8.50 per cent

   

The rate for FY22 was notably the lowest since 1977-78, when EPF interest was fixed at 8 per cent, according to PTI.

   

Final word

   

In an environment where fixed deposit rates and other savings instruments often see frequent revisions, EPF continues to offer a stable and government-backed return. For many salaried individuals, especially those in the private sector, this makes EPF a core component of retirement planning.

   

According to PTI, the crediting of interest for FY25 will reflect in EPF passbooks in the coming months. Subscribers are advised to keep an eye on their UMANG app or EPFO portal for updates.