Government ratifies employees’ provident fund interest rate at 8.25% for FY25

Compared to many fixed-income instruments, EPF offers relatively higher and stable returns, ensuring steady growth on post-retirement savings. File
| Photo Credit: The Hindu

The government has ratified the rate of interest on employees’ provident fund at 8.25% for FY25, enabling the retirement fund body EPFO to deposit the annual interest accumulation in the post-retirement funds of over 7 crore subscribers.

EPFO, on February 28, had decided to retain the interest rate of 8.25% on employees’ provident fund (EPF) deposits for the financial year 2024-25, equal to the rate provided in the preceding fiscal. The approved rate of interest for 2024-25 was sent for concurrence of the Ministry of Finance.

“The Ministry of Finance has given concurrence to an 8.25% rate of interest on the EPF for the 2024-25 fiscal year, and the Labour Ministry sent a communication regarding this to the EPFO on Thursday (May 22, 2025),” a labour ministry official told PTI.

Now the interest amount as per the rate ratified for FY25 will be credited into the accounts of over seven crore subscribers of EPFO.

The decision on interest rate was taken at the 237th meeting of the Central Board of Trustees of the EPFO, chaired by Union Minister for Labour & Employment Mansukh Mandaviya in New Delhi on February 28.

Compared to many fixed-income instruments, EPF offers relatively higher and stable returns, ensuring steady growth on post-retirement savings.

In February 2024, the EPFO had increased the interest rate marginally to 8.25% for 2023-24, from 8.15% in 2022-23.

In March 2022, EPFO had lowered the interest on EPF for 2021-22 to an over four-decade low of 8.1%, from 8.5% in 2020-21.

The 8.10% rate of interest on EPF for 2020-21 was the lowest since 1977-78, when it stood at 8%.