The Government of India has ratified the interest rate on Employees’ Provident Fund (EPF) deposits at 8.25% for the financial year 2024-25. This decision enables the Employees’ Provident Fund Organisation (EPFO) to credit the accumulated annual interest amount into the post-retirement accounts of over 7 crore EPF subscribers. The retention of the interest rate at 8.25% continues the rate from the previous financial year, maintaining stability in returns for EPF members.

On February 28, 2025, the EPFO decided to keep the interest rate unchanged for FY 2024-25, matching the rate for FY 2023-24. This approved rate was subsequently sent to the Ministry of Finance for concurrence. A Labour Ministry official informed PTI that the Ministry of Finance gave its concurrence, and the Labour Ministry communicated this approval to EPFO on the following Thursday. The ratified interest rate means the EPFO will deposit interest earnings at 8.25% into subscribers’ accounts, reinforcing the fund’s appeal as a reliable retirement savings instrument.

This interest rate decision was made at the 237th meeting of the Central Board of Trustees of the EPFO, chaired by Union Minister for Labour and Employment Mansukh Mandaviya in New Delhi. EPF, being one of the most widely used retirement savings schemes in India, is notable for offering comparatively higher and stable returns than many fixed-income financial instruments. This stability assures steady growth on retirement savings for subscribers, making it an attractive and secure investment option.

Over recent years, the EPFO has seen fluctuations in its interest rates. In February 2024, it marginally increased the interest rate from 8.15% for FY 2022-23 to 8.25% for FY 2023-24. This followed a significant reduction in March 2022 when the interest rate for FY 2021-22 was lowered to 8.1%, the lowest in over four decades. Previously, in FY 2020-21, the interest rate was 8.5%, and the 8.10% rate for FY 2020-21 was the lowest since 1977-78, when the rate was at 8%.

The EPF is a cornerstone of retirement planning for millions of Indian workers, providing a disciplined savings mechanism and a dependable return. The government's decision to maintain the 8.25% interest rate reflects its commitment to safeguarding the financial security of retired employees and ensuring a reliable income stream post-retirement.

By stabilizing the EPF interest rate, the government aims to foster confidence among subscribers and encourage sustained participation in this long-term savings scheme. The consistent returns not only help protect subscribers against inflation but also contribute to their financial independence after retirement. The EPFO’s steady governance and regulatory framework continue to play a critical role in managing the retirement corpus of millions, which cumulatively amounts to one of the largest social security funds in the country.

In summary, the ratification of an 8.25% interest rate for FY 2024-25 underscores the government's priority in maintaining a secure and beneficial retirement fund system. This rate continuity supports the financial well-being of over 7 crore EPF subscribers, ensuring their savings grow steadily and securely in the years leading to and following retirement.