The Employees' Provident Fund Organisation (EPFO) on Thursday recommended increasing interest rate for 2018-19 to 8.65 per cent as compared to 8.55 per cent in the previous year.
The decision was taken at the 224th meeting of the Central Board of Trustees (CBT). More than six crore subscribers will benefit from the move.
The decision before impending the General Elections is in line with several populist announcements by the NDA government, including the Budget announcement of income tax relief for the salaried class.
Labour Minister Santosh Gangwar said all CBT members agreed to give a higher interest for subscribers. The proposal will now go to the Finance Ministry for approval, he said after the CBT meeting.
EPFO has an active subscriber base of more than six crore and manages retirement savings of over Rs 11 lakh crore.
It will have a surplus of more than Rs 150 crore after doling out higher interest rates, said Gangwar.
The Central Board of Trustees (CBT) headed by Labour Minister is the apex decision-making body of the EPFO, which finalises the rate of interest on provident fund deposits.
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