New Delhi: The Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO), at its 239th meeting, recommended an 8.25% interest rate on EPF deposits for the financial year 2025–26, maintaining the same rate as the previous year despite global financial volatility and geopolitical tensions.
The interest rate, once notified by the Government of India, will be credited to EPF subscribers’ accounts. The decision reflects EPFO’s sustained financial discipline and strong investment performance, particularly through exchange-traded funds and other instruments, enabling it to deliver competitive returns to crores of workers.
Commenting on the decision, Vineet Nahata, member of the CBT (EPFO) and employer representative from the PHD Chamber of Commerce and Industry, said the board had maintained the rate despite global uncertainty.
“Interest rate was kept steady at 8.25% despite uncertainties in financial markets and the tense geopolitical situation, including the Israel–US vs Iran war,” Nahata said.
He also pointed to EPFO’s financial position, noting that even with a temporary income gap, the fund remains on a strong footing.
“The deficit of ₹944 crore on the income front, after inclusion of provisional one month March interest and last year’s surplus of ₹5,480 crore, left a healthy balance for next year as well,” he said.
According to Nahata, EPFO is also exploring structural mechanisms to ensure stable returns for subscribers.
“Next year we expect creation of an Interest Stabilization Reserve to formalise the consistency and predictability of stable interest payout to subscribers,” he added.
Alongside the interest rate decision, the CBT approved several policy and administrative reforms. Among the key announcements was a one-time Amnesty Scheme for exempted establishments, aimed at resolving compliance issues for income tax–recognised provident fund trusts that have not yet obtained EPFO exemption.
The scheme allows such establishments to regularise their status within a six-month window, with relaxation of damages, penalties and interest where employees have already received benefits comparable to statutory EPF provisions. The move is expected to resolve numerous pending disputes and litigation cases.
Highlighting the significance of the measure, Nahata said the initiative would help bring more trusts into the formal compliance framework.
“Launch of a one-time Amnesty Scheme for Income Tax-registered PF trusts not having EPFO code within six months will help bring them into compliance,” he said.
The board also discussed international cooperation in social security. India and the United Kingdom have agreed on a Double Contribution Convention (DCC) as part of the Comprehensive Economic and Trade Agreement, aimed at eliminating dual social security contributions for employees on temporary overseas assignments.
Nahata said the agreement would significantly benefit Indian professionals working abroad.
“The Indo-UK Double Contribution Convention will eliminate double social security contribution for employees on temporary short-term (36 months) overseas assignments,” he said.
The CBT meeting also approved several other measures, including alignment of the EPF, EPS and EDLI schemes with the Code on Social Security, 2020, simplification of the exemption process through a new digital standard operating procedure, and a pilot project for automatic settlement of small inoperative accounts.
Together, these steps aim to strengthen governance, improve compliance, and enhance service delivery for EPFO’s millions of subscribers while maintaining stable returns on their retirement savings.
