EPF Interest Rate 2025 : There is a relief news for crores of employed people of the country. The Finance Ministry has approved the interest rate of 8.25% for the financial year 2024-25 on the amount deposited in the Provident Fund (PF) account under the Employees’ Provident Fund Organization (EPFO).
₹5 Lakh PF? Here’s How Much Interest You’ll Earn
This EPFO decision will directly benefit more than 7 crore employees of the country and soon the interest amount will be transferred to their PF accounts. This is the second consecutive year when the interest rate has been kept stable at 8.25%. Let us understand – how much interest will be received, how it is calculated, and why the same interest is not given on the entire amount of your PF account.
The Central Board of Trustees (CBT), the apex decision-making body of EPFO, in its meeting held on 28 February 2024, passed a proposal to retain the interest rate of 8.25% on PF deposits for the financial year 2024-25.
This rate is equal to the rate given in the last financial year (2023-24). This proposal of CBT was sent to the Finance Ministry for final approval, which has now given its approval. This approval paves the way for EPFO to deposit interest in the accounts of its members.
How much interest will be received?
Now the biggest question is how much amount will be added to your PF account at this interest rate of 8.25%. Let us understand this with some examples:
How much interest on ₹ 1 lakh deposit?
If you have ₹ 1 lakh deposited in your EPF account at the beginning of the financial year 2024-25 (ie as opening balance on 1 April 2024), then according to the annual interest rate of 8.25%, you will get interest of ₹ 8,250 on it.
How much will you earn on ₹ 5 lakh deposit?
Similarly, if you have a total of ₹5 lakh deposited in your PF account as on April 1, 2024, then as per the interest rate of 8.25%, you will get ₹41,250 as interest for this financial year.
How much money will be received?
| PF Account Balance (as on April 1, 2024) | Annual Interest @ 8.25% |
|---|---|
| ₹ 1,00,000 | ₹ 8,250 |
| ₹ 3,00,000 | ₹ 24,750 |
| ₹ 5,00,000 | ₹ 41,250 |
| ₹ 10,00,000 | ₹ 82,500 |
Your and company contribution
As per the rules of the EPFO Act, 12% of your basic salary and dearness allowance (DA) is deposited in your PF account. The same amount, i.e. 12% of your basic salary + DA, is also contributed by your company (employer) for you.
The entire 12% of the employee goes to PF. Out of the company’s 12% contribution, 3.67% goes to the PF account, and the remaining 8.33% is deposited in the Employees’ Pension Scheme (EPS).
EPF Interest Calculation Formula Explained
Interest is calculated (EPF Interest calculation) on the basis of the money deposited every month in the EPF account i.e. monthly running balance. But, it is deposited at the end of the year.
According to EPFO rules, if any amount has been withdrawn from the balance amount on the last date of the current financial year, then interest for 12 months is calculated by deducting it. EPFO always takes the opening and closing balance of the account. To calculate this, the monthly running balance is added and multiplied by the interest rate/1200.
Interest is not paid on the entire amount
Generally, account holders believe that interest is paid on the entire amount deposited in the Provident Fund. But, this is not the case. No interest is calculated on the amount in the EPF account that goes to the Pension Fund (EPS).
PF interest rates from 1952-53 till now
| Year Range | Interest Rate (%) |
|---|---|
| 1952–1966 | 3.00 – 4.75% |
| 1967–1975 | 5.00 – 7.00% |
| 1976–1983 | 7.50 – 8.75% |
| 1984–1989 | 9.25 – 11.80% |
| 1990–1999 | 12.00% |
| 2000–2001 | 11.00% |
| 2001–2005 | 9.50% |
| 2006–2010 | 8.50 – 9.50% |
| 2011–2021 | 8.25 – 8.50% |
| 2021–2022 | 8.10% |
| 2022–2023 | 8.15% |
| 2023–2024 | 8.25% |
| 2024–2025 | 8.25% |
How PF Interest Rate Is Decided
- There is a prescribed process for deciding the interest rate on PF:
- First, the Finance Investment and Audit Committee (FIAC) of EPFO holds a meeting. This committee presents an account of the investments made by EPFO during that financial year and the earnings from them.
- Based on the report of FIAC, the Central Board of Trustees (CBT) meets. The CBT, which includes representatives of the government, employers and employees, discusses the interest rate and passes a resolution.
- The interest rate proposed by the CBT is sent to the Ministry of Finance for final approval.
The interest rate is officially implemented only after the consent of the Finance Ministry and is credited to the accounts of the members. Usually, the final decision on the interest rate is taken at the end of the financial year or some time after that.
How to Check PF Account Balance – Online
You can check the passbook of the PF account to see if the interest money has come or not. For this, you can either visit the official website of EPFO. Or you can also send the message ‘EPFOHO UAN ENG’ to 7738299899. 9966044425 is also a number on which PF balance can be checked by sending a missed call. Apart from this, PF account can also be accessed through UMANG app.
How to check EPF Balance Online
- Go to EPFO’s official website epfindia.gov.in.
- Click on the ‘Our Services’ tab. After this, select the option of ‘For Employees’.
- When the new page opens, you have to click on ‘Member Passbook’. Here you have to enter your UAN (Universal Account Number) and password.
- After this your passbook will open. In this you will see how much contribution has been made by your employer and you and how much interest has been received on it. If your interest has been credited by EPFO, then it will be reflected in it.
PF Interest Continues at 8.25%
The continuation of the interest rate of 8.25% on PF is definitely a positive news for crores of employees, especially at a time when interest rates on other savings schemes have been challenging.
This will not only help them grow their retirement fund but will also give them an opportunity to take another step towards a secure financial future. Employees are advised to keep checking their PF balance and statements regularly.
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