Retirement fund body EPFO is likely to retain 8.5 per cent interest on PF deposits for its over 5 crore subscribers in 2013-14, said a PTI news report.
The Employees' Provident Fund Organisation's apex decision making body - Central Board of Trustees (CBT) - is scheduled to meet today to decide on the PF interest rate for this fiscal. According to the agenda for the trustees' meet, 8.5 per cent interest will leave a small surplus of Rs 56.96 crore.
The EPFO, which is estimated to have an income of Rs 20,796.96 crore in the current fiscal, needs Rs 20,740 crore to pay 8.5 per cent interest to the subscribers.
EPFO had provided 8.5 per cent interest in the 2012-13 fiscal, which was higher than 8.25 announced in 2011-12.
According to estimates, hiking the interest payment by half a per cent to 9 per cent would require an additional amount of Rs 1,220 crore, which does not seem feasible.
"Payment of interest to the members is expenditure for the Trust (EPFO), which is to be met out of its earnings. Thus, the rate of interest should be commensurate with the total earnings of the Trust," the EPFO has said in its proposal to the trustees.
The trustees are meeting today after a gap of almost one year. They will also take up a proposal to increase the minimum administrative charges for managing EPF Scheme 1952 and Employees' Deposit Linked Insurance Scheme 1976 to Rs 500 and Rs 200 per month from existing rate of Rs 5 and Rs 2, respectively.
Dion Global Solutions Ltd.