EPFO yet to finalise rate of interest
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With half the financial year over, the country's largest retirement fund manager is yet to announce the interest rate on provident fund contributions by its five crore members for the year 2012-13.
The Employees' Provident Fund Organisation, which manages a corpus of over Rs 3.5 lakh crore, has been hoping to give an interest of about 8.6 per cent on contributions during the fiscal year 2012-13.
However, the organisation is yet to even start calculations to zero in on the interest rate on the savings in the provident fund account.
"We are yet to start the exercise. It could take another month at least. The issue will be taken up in the next meeting of the Central Board of Trustees," said an official.
This effectively means that members who withdraw their provident fund savings will earn the interest rate notified for last fiscal, when it was kept at 8.25 per cent.
Employee provident fund rates were reduced from 9.5 per cent in 2010-11 to 8.25 per cent during the last financial year.
"Interest rates should be ideally announced before the start of a financial year so that members can take informed investment decisions. It should not be endlessly deferred," said AD Nagpal, Hind Mazdoor Sabha Secretary and member of the CBT.
The decision regarding the interest rate is taken by the EPFO's Central Board of Trustees headed by the labour minister.
The Central Board of Trustees has met twice during the current financial year but has failed to come up with a final decision on the interest rate.
* The Employees' Provident Fund Organisation has been hoping to give an interest of about 8.6% on contributions
* With the announcement pending, members who withdraw their PF will earn 8.25%, the interest rate for last fiscal
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