EPFO New Update: An important update is emerging regarding the PF interest rate for FY26. The 239th Central Board of Trustees (CBT) meeting of the Employees’ Provident Fund Organisation (EPFO) is likely to be held in the first week of March. According to media reports, the interest rate on provident fund deposits for the financial year 2025-26 may be slightly reduced in this meeting.

According to reports, the interest rate on PF deposits in the next financial year may be fixed between 8 and 8.20 percent. Currently, this rate is 8.25 percent for 2024-25. It is believed that EPFO may make a slight reduction in the interest rate to maintain the stability of its fund.

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According to an Economic Times report, given the upcoming elections in states like West Bengal, Tamil Nadu, Assam, Kerala, and Puducherry in the coming months, EPFO may maintain the interest rate at around the current level for the third consecutive year. The report also states that a large number of new members are joining EPFO under the Pradhan Mantri Viksit Bharat Rozgar Yojana. In such a situation, a slight reduction in the interest rate can be made to maintain the necessary buffer in the fund to ensure payments to more people.

Likelihood of a lower interest rate

If the CBT approves the change in the interest rate, it will then be sent to the Ministry of Finance for approval. After getting the green light from them, the Ministry of Labour and Employment will officially notify them. After this, the new interest rate will be credited to the subscribers’ accounts by the middle of the year.

Earlier, the EPFO’s Finance, Investment and Audit Committee (FIAC) will meet in the last week of February. This committee will prepare a proposal for the interest rate based on the returns received from existing investments and present it to the CBT.

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Likelihood of an increase in monthly salary

Along with this, it is also expected that the board may consider the proposal to increase the wage ceiling under EPFO. Currently, the wage ceiling for EPFO is ₹15,000 per month, and there may be discussions to increase it to ₹25,000 per month. This would bring more employees under the ambit of social security. However, the agenda for the CBT meeting has not yet been finalized.

It is worth noting that in January, the Supreme Court had directed the EPFO to consider increasing the wage ceiling within four months. The court cited rising inflation and wage levels, stating that the current limit excludes a large number of employees from social security coverage.

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