EPFO interest rate will continue to be 8.25 pc for FY2024-25

The decision was taken during the 237th meeting of the Central Board of Trustees (CBT), EPF, chaired by Union Labour and Employment Minister Mansukh Mandaviya in New Delhi on Friday.

According to an official statement, the interest rate will be officially notified by the government, after which EPFO will credit the amount to the subscribers' accounts.

Ministry said "CBT recommended 8.25 per cent annual rate of interest to be credited on EPF accumulations in members' accounts for the financial year 2024-25. The interest rate would be officially notified by the Government of India, following which EPFO would credit the rate of interest into the subscribers' accounts".

The government also highlighted that EPF continues to offer high and stable returns compared to many other fixed-income instruments. The interest earned on EPF deposits is also tax-free up to a specified limit, making it a preferred long-term investment option for salaried employees.

Apart from the interest rate announcement, the CBT approved key modifications in the Employees' Deposit Linked Insurance (EDLI) scheme to improve financial security for the families of EPF members.

One of the major changes is the introduction of a minimum insurance benefit for employees who pass away within one year of service.

Additionally, the Board decided to provide insurance coverage for members who die after a period of non-contribution, as earlier such cases were denied benefits.

Another significant change is the consideration of service continuity. Previously, even a one- or two-day gap between jobs, such as weekends or holidays, resulted in the denial of minimum EDLI benefits ranging from Rs 2.5 lakh to Rs 7 lakh, as it broke the condition of continuous service for one year.

This issue has now been addressed, ensuring that employees and their families do not lose out on financial security due to technical gaps.

The Labour Ministry stated that these changes would lead to higher benefits in more than 20,000 cases of in-service deaths annually, strengthening the social security net for workers. The government reaffirmed its commitment to enhancing financial stability for EPF members and their families, ensuring better protection in times of need. (ANI)